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An impossible triangle? The impact of housing policy on affordability, accessibility, and efficiency

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  • Jason Nassios
  • James Giesecke
  • Xianglong Locky Liu

Abstract

While the impact of housing-related tax instruments on economic efficiency and housing markets has been widely studied, the impact of expenditure instruments has received less attention. Housing grants, transfer duty concessions, shared equity schemes, and rental assistance, are several such expenditure instruments that generate debate regarding their efficacy in achieving housing policy aims. This study examines the impact of these instruments on the housing market. We find that each instrument addresses a specific housing policy aim, but cannot simultaneously improve affordability, accessibility, and efficiency. This finding reinforces the need for policymakers to establish clear and targeted objectives to guide housing policy choices.

Suggested Citation

  • Jason Nassios & James Giesecke & Xianglong Locky Liu, 2024. "An impossible triangle? The impact of housing policy on affordability, accessibility, and efficiency," Centre of Policy Studies/IMPACT Centre Working Papers g-344, Victoria University, Centre of Policy Studies/IMPACT Centre.
    • Handle: RePEc:cop:wpaper:g-344
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    References listed on IDEAS

    as
    1. Giesecke, James A. & Madden, John R., 2013. "Regional Computable General Equilibrium Modeling," Handbook of Computable General Equilibrium Modeling, in: Peter B. Dixon & Dale Jorgenson (ed.), Handbook of Computable General Equilibrium Modeling, edition 1, volume 1, chapter 0, pages 379-475, Elsevier.
    2. Gianni La Cava & Hannah Leal & Andrew Zurawski, 2017. "Housing Accessibility for First Home Buyers," RBA Bulletin (Print copy discontinued), Reserve Bank of Australia, pages 19-28, December.
    3. William M. Rohe, 2017. "Tackling the Housing Affordability Crisis," Housing Policy Debate, Taylor & Francis Journals, vol. 27(3), pages 490-494, May.
    4. Miguel Lorga & João Fragoso Januário & Carlos Oliveira Cruz, 2022. "Housing Affordability, Public Policy and Economic Dynamics: An Analysis of the City of Lisbon," JRFM, MDPI, vol. 15(12), pages 1-12, November.
    5. James A. Giesecke & Christopher King & Jason Nassios & Nhi Hoang Tran, 2021. "The impact of GST reform on Australia’s state and territory economies," Applied Economics, Taylor & Francis Journals, vol. 53(51), pages 5929-5947, November.
    6. Xianglong Locky Liu & James Giesecke & Jason Nassios, 2023. "The Economic Effects of an International Student Levy Under Alternative Price Elasticity Assumptions," Centre of Policy Studies/IMPACT Centre Working Papers g-343, Victoria University, Centre of Policy Studies/IMPACT Centre.
    7. Jason Nassios & James Giesecke, 2022. "Inefficient at Any Level: A Comparative Efficiency Argument for Complete Elimination of Property Transfer Duties and Insurance Taxes," Centre of Policy Studies/IMPACT Centre Working Papers g-337, Victoria University, Centre of Policy Studies/IMPACT Centre.
    8. James A. Giesecke & Nhi H. Tran, 2018. "The National and Regional Consequences of Australia's Goods and Services Tax," The Economic Record, The Economic Society of Australia, vol. 94(306), pages 255-275, September.
    9. Jason Nassios & James Giesecke, 2022. "Property Tax Reform: Implications for Housing Prices and Economic Productivity," Centre of Policy Studies/IMPACT Centre Working Papers g-330, Victoria University, Centre of Policy Studies/IMPACT Centre.
    10. James Giesecke & Peter B. Dixon & Maureen T. Rimmer, 2008. "Regional macroeconomic outcomes under alternative arrangements for the financing of public infrastructure," Papers in Regional Science, Wiley Blackwell, vol. 87(1), pages 3-31, March.
    11. Janine M. Dixon & Jason Nassios, 2018. "A Dynamic Economy-wide Analysis of Company Tax Cuts in Australia," Centre of Policy Studies/IMPACT Centre Working Papers g-287, Victoria University, Centre of Policy Studies/IMPACT Centre.
    12. Xianglong Locky Liu & James Giesecke & Jason Nassios, 2023. "The Economic Effects of an International Student Levy," Centre of Policy Studies/IMPACT Centre Working Papers g-341, Victoria University, Centre of Policy Studies/IMPACT Centre.
    13. Işıl Erol & Alper Güzel, 2006. "The Elasticity Of Capital–Land Substitution In The Housing Construction Sector Of A Rapidly Urbanized City: Evidence From Turkey," Review of Urban & Regional Development Studies, Wiley Blackwell, vol. 18(2), pages 85-101, July.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    First homeowner grant; Shared equity; Transfer duty concession; Homeownership; Housing affordability; Housing prices; Excess burden;
    All these keywords.

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • R38 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Government Policy

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