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The bloc québécois’ housing platform

Published by Anonymous (not verified) on Mon, 13/09/2021 - 7:23am in

With Canadians heading to the polls in a federal election this month, I’ve written a 600-word overview of the Bloc Québécois’ housing platform.

It’s available here: https://nickfalvo.ca/ten-things-to-know-about-the-bloc-quebecois-housing...

The bloc québécois’ housing platform

Published by Anonymous (not verified) on Mon, 13/09/2021 - 7:23am in

With Canadians heading to the polls in a federal election this month, I’ve written a 600-word overview of the Bloc Québécois’ housing platform.

It’s available here: https://nickfalvo.ca/ten-things-to-know-about-the-bloc-quebecois-housing...

The Housing Boom and the Decline in Mortgage Rates

Published by Anonymous (not verified) on Thu, 09/09/2021 - 6:01am in

During the pandemic, national home values and housing activity soared as mortgage rates declined to historic lows. Under the canonical “user cost” house price model, home values are held to be very sensitive to interest rates, especially at low interest rate levels. A calibration of this model can account for the house price boom with the observed decline in interest rates. But empirically, we find that home values are nowhere near as sensitive to interest rates as the user cost model predicts. This lower sensitivity is also found in prior economic research. Thus, the historical experience suggests that lower interest rates can only account for a tiny fraction of the pandemic house price boom. Instead, we find more scope for lower interest rates to explain the rise in housing activity, both sales and construction.

Since February 2020, national home values have risen more than 15 percent across several house price indices. At the same time, existing home sales and building permits for new privately owned housing units have soared to levels last seen in 2007, and Q4/Q4 real residential investment, as measured by the Bureau of Economic Analysis, grew about 16 percent in 2020. Thirty-year fixed rate mortgage rates dropped to an historic low of 2.7 percent in December 2020. At 3 percent during the summer of 2021, mortgage rates remain depressed and 50 basis points below February 2020 levels. How much of the housing boom can be explained with the lower level of interest rates?

Elasticity of House Prices to Mortgage Rates in Theory: The User Cost Model

Standard calibrations of the most popular theoretical framework of housing valuation—the user cost model—can in fact quantitatively explain the rise in house prices with the decline in interest rates. In its simplest form, the model postulates that the raw return on housing, including both the rent yield and growth of rent, should be equal to the sum of borrowing cost and property taxes, maintenance, and insurance (taking housing supply and rents as given):

where is the rent to price yield, g is the expected capital gain rate, ρ is the effective borrowing cost (mortgage rate after tax deduction), and τ accounts for property taxes, maintenance, and insurance.

From this formula, we can calculate how much home prices rise for every 1 percentage point decline in the mortgage rate, or the semi-elasticity of house prices to changes in mortgage rates, which we refer to as the “semi-elasticity.” The chart below illustrates the predicted semi-elasticity under a set of commonly used parameters from Himmelberg et al. (2005) (marginal tax rate at 25 percent, property taxes, maintenance and insurance in total at 4 percent, growth of rent at 3.8 percent). Importantly, the semi-elasticity rises as interest rates decline, meaning that house prices become particularly sensitive to interest rate changes in a low-rate environment. For example, the semi-elasticity is about 23 when mortgage rates are at 4 percent, but it increases to about 30 when mortgage rates are at 3 percent. These statistics suggest that a decline in the mortgage rate from 3.5 percent to 3 percent would cause home prices to rise about 14 percent, which is just about as we observed. But as we show in the rest of the post, these predicted effects are much larger than our empirical estimates and those found in the economic literature.

User Cost Model Predicts High Sensitivity of House Prices to Mortgage Rates

Note: This graph plots the semi-elasticity of house prices to changes in the mortgage rate as a function of the mortgage rate, or how much home prices rise for every 1 percentage point decline in the mortgage rate.

Source: Authors’ calculations.

Elasticity of House Prices and Activity to Mortgage Rates in Practice: Empirical Evidence

We use a Jorda (2005) linear projection framework and quarterly macroeconomic data between 1975 and 2020 to study the semi-elasticity of the FHFA house price index, building permits for single-family units, existing home sales, and residential investment (rescaled as a contribution to real GDP). Estimating the semi-elasticity to interest rates using macroeconomic data is challenging because movements in mortgage rates depend on the state of the economy, which is a confounding factor. Our first econometric specification (no contemporaneous controls) accounts for the economic state by including past realizations of the unemployment rate, the 1-year Treasury rate (as a proxy for monetary policy), and CPI inflation. In the second specification (contemporaneous controls), we include these controls contemporaneously, so that the estimated semi-elasticity only reflects changes in the residual mortgage rate component, which is driven by term premia for long-term rates and the mortgage basis (or spread). All specifications also include lags of each housing variable, so that the linear projections are equivalent to impulse responses from vector autoregressions commonly used in empirical macroeconomic analysis (Plagborg-Moller and Wolf 2021).

The chart below shows the response of each variable when excluding (orange) and including (blue) the contemporaneous controls after a 1 percentage point decline in the mortgage rate. We find significant effects, with the expected signs, and with stronger and more persistent responses when not including controls. The (maximum) semi-elasticity of house prices to mortgage rates is -2, with or without contemporaneous controls. This is less than a tenth as large as what is predicted by the user cost model. Housing activity is, instead, very sensitive to mortgage rates. After a 1 percentage point decline in mortgage rates, permits rise more than 10 percent, existing homes sales increase 5-10 percent, and residential investment expressed as a contribution to real GDP increases 0.3 percentage point (0.2 percentage point with controls).

Mortage Rates Affect House Prices and Housing Activities

Notes: The above charts show impulse responses to a 100 basis point (or 1 percentage point) decline in mortgage rates from linear projections (LPs). The LPs include lags of each dependent variable, mortgage rates, and a set of controls that include the unemployment rate, the 1-year Treasury rate (as proxy for monetary policy), and CPI inflation. The “contemporaneous controls” specification includes these controls up to quarter 0. Blue and orange bands are 90 percent confidence bands for the model, including contemporaneous controls and only lagged controls.

Sources: Authors’ calculations, based on data from Federal Reserve Board, Bureau of Labor Statistics, Freddie Mac, FHFA, Census Bureau, National Association of Realtors, and Bureau of Economic Analysis.

Elasticity of House Prices to Mortgage Rates in Practice: Prior Research

To what extent are our results specific to our statistical model?  Prior research uses both macro and micro data to estimate the semi-elasticity of house prices to interest rates (in contrast, few studies look at the response of housing activity to interest rates). As shown in the table below, most empirical estimates from this literature suggest that house prices increase by less than 5 percent for every 1 percentage point decrease in (long-term) interest rates–substantially less than implied by the user cost model and consistent with our results.

Estimated Effects of Interest Rates on House Prices

MethodHome Price Appreciation After a 1 Percentage Point Drop in the Mortgage RateMacro Papers:Del Negro and Otrok 2007U.S.VAR0.8Goodhart and Hofmann 2008InternationalVAR1.6Jarocinski and Smets 2008U.S.VAR2Sa, Towbin, and Wieladek, 2011InternationalVAR1.2Williams 2015InternationalFixed exchange rate6.3    Micro Papers:   DeFusco and Paciorek 2017U.S.Bunching around CLL[1.5, 2]Adelino, Schoar, and Severino 2020U.S.Diff in diff around CLL[1.3, 5.3]Davis, Oliner, Peter, Pinto 2020U.S.Cut in FHA insurance premium3.4Fuster and Zafar 2021U.S.Consumer survey2.5

Notes: This table summarizes the literature on the relationship between house prices and interest rates. The “macro papers” panel summarizes five papers from the large literature using macroeconomic data. The second panel reviews four papers based on microeconomic data. The “U.S./International” column reports whether the study is based on U.S. or international data. The “Method” column reports the identification strategy. “CLL” stands for conforming loan limit. The last column reports the estimated effect on house prices after a 1 percentage point interest rate shock. For macro papers, these effects are 10 quarters after a 1 percentage point monetary policy shock. For the micro papers, the effects are for a 1 percentage point shock in the mortgage rate.

One difference between the macro and the micro literatures is in the measure of interest rate used. Macro papers tend to study monetary policy shocks or shocks to long term rates, either nominal or real. Micro studies often focus on mortgage rate shocks using arguably exogenous cutoffs at mortgage origination. For example, one such cutoff is the conforming loan limit (CLL). Most mortgages that are smaller than the CLL are guaranteed by Fannie Mae or Freddie Mac, enjoying lower interest rates than loans that are larger than the CLL, also known as jumbo loans. By looking at house prices around this exogenous cutoff and how they change when the CLL increases, Adelino, Schoar, and Severino (2020) find a semi-elasticity between -5.3 and -1.3.

Rather than using mortgage and house price data, Fuster and Zafar (2021) use the housing module of the New York Fed Survey of Consumer Expectations to elicit how much survey respondents are willing to pay for the same house in two hypothetical scenarios: when the mortgage rate is 4.5 percent or 6.5 percent. They find that even a 2-percentage point increase in the mortgage rate only lowers borrowers’ willingness to pay by 5 percent.


The semi-elasticity of house prices to interest rates implied by the theoretical user cost model suggests that the decline in mortgage rates during the pandemic can quantitatively account for the national house price boom. But our empirical estimates and prior studies suggest that the decline in mortgage rates can only explain low single-digit house price increases. Instead, we find that housing activity, both sales and construction, are very sensitive to interest rates.

Haoyang Liu is an economist in the Federal Reserve Bank of New York’s Research and Statistics Group.

David Lucca is a vice president in the Bank’s Research and Statistics Group.

Dean Parker is a senior research analyst in the Bank’s Research and Statistics Group.

Gabriela Rays-Wahba is a senior research analyst in the Bank’s Research and Statistics Group.

How to cite this post:
Haoyang Liu, David Lucca, Dean Parker, and Gabriela Rays-Wahba, “The Housing Boom and the Decline in Mortgage Rates,” Federal Reserve Bank of New York Liberty Street Economics, September 7, 2021, https://libertystreeteconomics.newyorkfed.org/2021/09/the-housing-boom-a....

The views expressed in this post are those of the authors and do not necessarily reflect the position of the Federal Reserve Bank of New York or the Federal Reserve System. Any errors or omissions are the responsibility of the authors.

If Prices Fall, Mortgage Foreclosures Will Rise

Published by Anonymous (not verified) on Wed, 08/09/2021 - 7:09am in

In our previous post, we illustrated the recent extraordinarily strong growth in home prices and explored some of its key spatial patterns. Such price increases remind many of the first decade of the 2000s when home prices reversed, contributing to a broad housing market collapse that led to a wave of foreclosures, a financial crisis, and a prolonged recession. This post explores the risk that such an event could recur if home prices go into reverse now. We find that although the situation looks superficially similar to the brink of the last crisis, there are important differences that are likely to mitigate the risks emanating from the housing sector.

Same Old Story?

Our last post demonstrated that price increases have been unusually strong and are now at rates not seen since just prior to their peak in 2005 at 16 percent year-over-year. Prices then fell 20 percent between mid-2006 and early 2009. By 2012 the average home had lost about a quarter of its 2006 value. Because prices had risen and fallen so fast, new mortgage originations in the period leading up to the peak, including those with substantial down payments, were quickly put into negative equity, which is a major risk factor for foreclosure, as both academic research and the experience of 2007-11 demonstrate.

Are developments in the housing market now essentially the same? Well prices have certainly been rising very fast, and mortgage originations have also been strong. The former, however, has outpaced the latter in recent months. Additionally, the owner’s share of housing wealth is 67 percent as of the first quarter of 2021, its highest value since 1989. (This is the value of the property minus the debt owed on it, expressed as a share of the property value.) Note that during the previous housing boom (1995-2006) this measure didn’t rise, in spite of sharply rising home prices. Additional borrowing was large enough to keep the owner’s share roughly constant at about 61 percent.

Of course this is an aggregate figure, and the distribution of leverage is a more important indicator of risks in the housing market. To examine this, we use the method developed in this Economic Policy Review article to assess current risks in the housing market at the property level. We begin by providing an updated Combined Loan to Value (CLTV) ratio for a large sample of mortgaged properties in the United States, using sale or appraised values at mortgage origination and estimating price appreciation using the CoreLogic Home Price Index. A property’s CLTV is the value of all debt secured by the property, divided by the value of the property, and is thus equal to 100 percent minus the owner’s equity as a share of the property value. The next chart shows the updated distribution of CLTV across current mortgage borrowers through December 2020. Note that our data set is limited to mortgage borrowers and thus excludes all properties owned “free and clear” (with no mortgage).

The Current Distribution of Mortgage Performance Indicators

Each color in the chart below corresponds to a CLTV level: light blue and dark gray correspond to properties that are in negative equity—a CLTV over 100 percent – while light gray, gold, and dark blue reflect decreasing leverage levels. As the chart shows, negative equity is very rare now, while more than 85 percent of all properties have a CLTV<80, meaning they have at least a 20 percent equity cushion. This sounds quite comforting: households generally have a lot of equity in their properties. However, the situation was much the same in 2005. We can look deeper into another indicator that complements equity position and shows a difference between now and 2005: credit score.

A Small Share of Properties Have High (>80%) Combined Loan to Value Ratios

Source: Authors’ calculations using data from CoreLogic and Equifax Credit Risk Insight Servicing McDash.

Credit score is another strong predictor of mortgage performance for borrowers, conditional on their equity position. While the CLTV distribution in 2020 looks quite similar to that in 2005, the credit score distribution definitely does not. More than two-thirds of mortgage debt in 2020 was held by borrowers with a FICO score above 740, compared to just over 50 percent on the eve of the housing crisis in the early 2000s. Perhaps more importantly, about 10 percent of current debt is owed by borrowers with a current score below 660, compared with nearly 20 percent in early 2006.

What if Prices Fall?

In order to fully understand the riskiness of this stock of debt, we go one step further by calculating expected delinquency transitions under various adverse price scenarios. Those scenarios are described in the table below and include prices which revert to their level from two years ago (HPI-2) and four years ago (HPI-4) in each county. (In cases where the stress scenario produces an increase in prices, we set price change to zero.) These scenarios are fairly severe in light of strong recent price growth – the median county would see prices fall by more than 27 percent under HPI-4 . Even the 10 percent least affected counties would see double-digit declines.

Stressed Home Price Scenarios

Price ScenarioPrice ScenarioHPI-2HPI-4Δ P, 10th percentile-16.6%–27.6%Δ P, 50th percentile-11.9-20.7Δ P, 90th percentile-7.8-13.1Max State DeclineIdahoIdaho, Utah

Source: Authors’ calculations based on data from CoreLogic.

What can we say about how mortgage performance would evolve under these scenarios? To start with, the price declines would drive many borrowers into negative equity, putting them at risk of default. Because of strong price growth since 2016, we estimate that Idaho, Utah, Nevada, and Arizona would all experience negative equity rates of more than 30 percent under HPI-4.

Yet the favorable credit score distribution would ameliorate the effects of these price declines on mortgage defaults. In the maps below, we show expected mortgage default rates under the two scenarios. More specifically, the maps show the 24-month transition rates for loans that were current (and not in forbearance) as of December 2020. To estimate these transitions, we use default rates from the 2007-10 period for each CLTV and FICO score combination, as described in Chart 12 of this paper. We estimate that 3.9 percent of mortgage balances overall would transition to delinquency by December 2022 under HPI-2 and 5.1 percent under HPI-4. These figures would be a significant increase in defaults over those observed in recent years, but they would fall far below the double-digit default rates observed during the crisis, when price declines were more severe, and the credit distribution was far less favorable.

As the maps show, however, there is significant geographic dispersion in the expected default rates. Relatively high rates of delinquency transitions appear in some expected places—Arizona, Florida, and Nevada are all above average risk for the HPI-2 and HPI-4 scenarios. But California is now at below average risk from these shocks, while Georgia, Idaho, Indiana, Mississippi, and Utah have emerged as newly vulnerable, given strong recent price growth in many of those states. Still, none of these states would be expected to match the national average default rates observed during the crisis, let alone the very high rates witnessed in Arizona, California, Florida, and Nevada.

24-month Serious Delinquency Forecasts: HPI 2 Years Ago

24-month Serious Delinquency Forecasts: HPI 4 Years Ago

Source: Authors’ calculations using data from CoreLogic and Equifax Credit Risk Insight Servicing McDash.

There is at least one caveat to this fairly benign scenario: mortgage forbearances. As noted above, our default estimates exclude loans already in forbearance. Those represent about 2.7 percent of loans in June 2020. Because widespread forbearance is a new approach to avoiding default and foreclosure, little is known about how these borrowers will fare when the programs end. Some share will likely be able to resume making payments, while others may have to sell their homes. Given strong price growth and very tight for-sale inventories of housing, these borrowers will generally have positive equity if they have to sell, enabling them to pay off their loans and avoid default. Nonetheless, the transition out of these programs is one additional factor to keep track of when monitoring housing risk.

Andrew Haughwout is a senior vice president in the Federal Reserve Bank of New York’s Research and Statistics Group,

Belicia Rodriguez is a senior research analyst in the Bank’s Communications and Outreach Group.

How to cite this post:
Andrew F. Haughwout and Belicia Rodriguez, “If Prices Fall, Mortgage Foreclosures Will Rise,” Federal Reserve Bank of New York Liberty Street Economics, September 8, 2021, https://libertystreeteconomics.newyorkfed.org/2021/09/if-prices-fall-mor...

Related Reading
Does the Rise in Housing Prices Suggest a Housing Bubble?
Tracking and Stress-Testing U.S. Household Leverage (Economic Policy Review)
Houses as ATMs No Longer 
Mapping Home Price Changes (interactive)

The views expressed in this post are those of the authors and do not necessarily reflect the position of the Federal Reserve Bank of New York or the Federal Reserve System. Any errors or omissions are the responsibility of the authors.

Does the Rise in Housing Prices Suggest a Housing Bubble?

Published by Anonymous (not verified) on Wed, 08/09/2021 - 7:08am in

House prices have risen rapidly during the pandemic, increasing even faster than the pace set before the 2007 financial crisis and subsequent recession. Is there a risk that another dangerous housing bubble is developing? This is a complicated question, and the answer has many components. This post, the first of two, provides a more detailed look at the recent rise in home prices by breaking it down geographically, with a comparison to the pre-2007 bubble. The second post looks at the potential risks to financial stability by comparing the currently outstanding stock of mortgage debt to the period before the financial crisis and projecting defaults should prices decline.

The Sharp Rise in Housing Prices during the Pandemic

The U.S. economy shut down in March 2020 due to the pandemic. Yet, by the summer housing prices started to rise sharply despite high unemployment. How similar is this to the early 2000s? We would be worried if the housing market were playing out exactly as it did in the prior boom. In the time series, we aren’t there yet: so far, we’ve had about one year of double-digit price growth, compared to the national average compound annual growth rate of more than 14 percent between 2003 and 2005.

Home Prices Are Rising Faster Now than during the Bubble

Source: CoreLogic Home Price Index, January 2003-June 2021.

Spatial Patterns of Home Price Growth

What about trends at the regional level? It turns out that the boom is taking place in different places within and across metro areas this time around. For most places, recent home price growth has been even stronger than during the previous boom: 79 percent of metropolitan areas in our data saw higher growth rates during the pandemic than during the peak years 2003-05. Of the thirty metropolitan areas containing the most populated cities in the country, 63 percent saw higher growth during the pandemic compared to 2003-05. In the chart below, we plot a 45-degree line, colored in gray, to differentiate which of the metropolitan areas with the largest population saw their fastest growth during either the pandemic or the housing bubble. Austin, Charlotte, Seattle, and Atlanta are a few metropolitan areas above the 45-degree line, meaning they have had higher growth rates during the pandemic. On the other hand, Las Vegas, Los Angeles, Miami, and New York had higher growth rates during 2003-05 and are below the 45-degree line. Some areas, however, saw similar paces of growth: Sacramento had minimal variation between its pandemic and housing bubble growth rates, putting the city close to the 45-degree line.

At the regional level, the northeast and south have positive trends in the graph, meaning that price increases are positively correlated in the two boom periods, whereas the midwest and west have slightly negative trends. The midwest points are clustered between growth rates of 10-20 percent for the pandemic and between 0-10 percent for 2003-05, whereas the other regions are more spread out. The west has the majority of its points above the trendline, while the south has most of its points near or below the trendline. The northeast points have the strongest positive relationship when compared to the other regions.

The blue regression line shows there is a positive relationship in the whole data set between house price growth during the housing bubble and the pandemic, meaning metropolitan areas that had high annual growth between 2003-05 saw higher growth rates during the pandemic, and vice versa. But note how flat the regression line is and how far away most of the dots are from the line, suggesting the relationship is weak. Many metropolitan areas that experienced fast-growing housing prices in 2003-05 have had slower growth rates during the pandemic and vice versa.  

Most Metro Home Prices Have Grown Faster during the Pandemic than during 2003-05

Source: CoreLogic Home Price Index.

Note: Each city represents the home price index of its respective metropolitan statistical area.

House Prices in Urban Areas Have Been Growing More Slowly than in Suburban and Rural Areas

The data above cover metropolitan areas and include both urban and suburban housing. A breakdown along these lines shows that house prices in urban areas have grown at a slower rate than those in suburban areas during the pandemic. To arrive at our urban classification, we first define the zip code that has the highest employment density, which we call the employment hub. We categorize zip codes as “urban” if they are within five miles of the employment hub, belong to a metropolitan statistical area, and have a population density greater than the 95th percentile. For suburban areas, we categorize zip codes as “suburban within 5/10/15/15+ miles” if they are within 5, 10, 15, or 15+ miles of the employment hub and if they are not already classified as urban (or any other suburban category).

As seen in the chart below, urban areas defined in this way have usually had the higher year-over-year house price growth compared to suburban areas, but starting around November 2018, these urban areas began to see lower rates of growth compared to suburban areas. Once the pandemic took hold in March 2020, urban areas did see a sharp increase in price growth, but suburban areas grew much faster and are above 15 percent year-over-year growth, whereas urban areas are around 10 percent. There are exceptions to even the relatively modest growth in urban areas: Manhattan (New York County) saw a price decline of 4.3 percent year over year in June, the largest county price decline nationwide.

Of course, many factors other than relative location may affect price growth. But urban classification is a significant characteristic even controlling for some of these other factors. The significant lag of home price growth in the past year isn’t attributable to zip code income or the level of home prices before the pandemic. When we control for these factors, it turns out that dense urban areas had been growing at a pace close to that of other parts of metro areas, until 2020 when they fell way behind.

Urban Home Prices Have Underperformed during the Pandemic

Source: CoreLogic Home Price Index.

There are also regional differences within urban areas. The northeast is not growing as rapidly as the midwest, west, and the south. Up until the end of 2020, all regional lines were following similar trends throughout the pandemic. At the beginning 2021 the west, south, and midwest continued to grow rapidly while the northeast began to see a slight stagnation in growth. These regional differences may have to do with the different rates of growth of cities in these areas compared to cities in other areas, and this shows how the urban classification can manifest differently depending on the region.

Urban Zip Codes Have Slower Home Price Growth in the Northeast

Source: CoreLogic Home Price Index.

Although prices are increasing rapidly nationwide, the data show we are not simply repeating the housing market bubble of the early 2000s during the pandemic. This boom is taking place in different metro areas and in different locations within metros. Still, home price growth in excess of 15 percent per year can’t be sustained forever, so a remaining question is how price growth will normalize and what the consequences of a decline in prices could be. We turn to this question in our next post.

Andrew Haughwout is a senior vice president in the Federal Reserve Bank of New York’s Research and Statistics Group.

Belicia Rodriguez is a senior research analyst in the Bank’s Communications and Outreach Group.

How to cite this post:
Andrew Haughwout and Belicia Rodriguez, “Does the Rise in Housing Prices Suggest a Housing Bubble?,” Federal Reserve Bank of New York Liberty Street Economics, September 8, 2021, https://libertystreeteconomics.newyorkfed.org/2021/09/does-the-rise-in-h....

Related Reading
Mapping Home Price Changes (interactive)
Keeping Borrowers Current in a Pandemic (May 2021)
Do People View Housing as a Good Investment and Why? (April 2021)

The views expressed in this post are those of the authors and do not necessarily reflect the position of the Federal Reserve Bank of New York or the Federal Reserve System. Any errors or omissions are the responsibility of the authors.

The Mental Health Power of Mooncakes

Published by Anonymous (not verified) on Thu, 02/09/2021 - 1:25am in

Deliciously destigmatized

In Chinese communities everywhere, the Mid-Autumn Festival is fast approaching, and with it, the silky, syrupy indulgence that signals its arrival: the delectable mooncake. 

This year in Shanghai, one particular mooncake has already gone viral: the ones sold in the Shanghai Mental Health Center [SMMC] cafeteria, which are stamped with the hospital’s name and logo. The SMMC has long struggled with its public image. Even in bustling Shanghai, mental health issues are often stigmatized, and people who seek help for them face the prospect of public shaming. 

But something changed recently, as evidenced by the surge in demand for SMMC mooncakes. Some residents attribute the shift to the stresses of Covid-19, which revealed that mental health issues can affect anyone. Whatever the cause, out of the blue, an institution that’s used to being whispered about is discovering that its branded mooncakes are suddenly in high demand.

Photos of them are flying on Weibo and WeChat, and locals are scheming up ways to get their hands on the snacks, which are only available to hospital employees. Those who manage to get one are using it as an opportunity to talk openly about mental health on social media. It doesn’t hurt that the mooncakes are top notch — one well-known Shanghai food blogger who acquired one called them “among the top three mooncakes I have ever reviewed… The fillings ooze out as soon as you cut them, and the texture is soft and gooey.”

The craze appears to be a turning point for public perception of the hospital. “There used to be a heavy stigma around the address,” said one resident who lives down the street from it. “The awareness of mental health illnesses among young people has grown, and as a result, prejudice about it is gradually lifting.”

Read more at Sixth Tone

Floor plans

It is often said that housing is health care, an acknowledgment that people’s wellbeing requires a safe, sanitary home — including the part of the home that’s right under their feet. 

For more than a billion people around the world, what is underfoot is a dirt floor that can harbor insects, kick up dust and obscure disease-carrying substances like fecal matter. One organization, EarthEnable, started by Stanford University student Gayatri Datar, has replaced 11,000 dirt floors in rural Rwanda and Uganda with a flaxseed resin they invented in house. The resin costs two to five dollars per square meter, a fraction of the cost of cement, and can be paid for over the course of six months by recipient families.

earthenablePhoto courtesy EarthEnable

EarthEnable’s efforts echo similar ones that have been implemented elsewhere. In Mexico, the government spent $1.3 billion to install three million cement floors over the course of six years. In one town that received the upgrades, diarrhea in children fell by 13 percent and anemia dropped by one-fifth. Advocates are quick to point out that improved floors must be paired with other upgrades to work, like sanitation, but under the right circumstances can be one of the cheapest and fastest ways to upgrade housing. 

Read more at Bloomberg CityLab

Express service

What if waiting for a bus turned out to be the best part of your day? RideKC, Kansas City’s regional transit service, has reimagined one of its bus stops with that ideal in mind. 

At the city’s East Village Transit Center, folks don’t just stand around looking at their phones. They can engage with a range of city services while being assisted by the people who actually work for them. Straphangers can check out books from the library system, get a Covid shot, talk with a representative from the local community college about how to pursue a degree, and — in the coming months — search for a job with help from someone who works with the Full Employment Council, a local group that connects qualified workers and businesses. 

It’s a simple, light-lift idea that combines transit use and civic engagement. So far, the bus stop services have been popular enough that RideKC is looking to expand them — its latest priority is  integrating a healthcare organization that can help bus riders access preventative care or apply for insurance. “We want to be a beacon on the east side of downtown,” said the vice president of RideKC. “Most of the amenities downtown pretty much stop at City Hall, and there’s really nothing over here but us.”

Read more at the Kansas City Beacon

The post The Mental Health Power of Mooncakes appeared first on Reasons to be Cheerful.

Liberal party’s housing platform

Published by Anonymous (not verified) on Wed, 01/09/2021 - 10:25pm in

With a federal election taking place in Canada in fewer than three weeks, I’ve written a 950-word overview of the Liberal Party’s housing platform.

It’s available here: https://nickfalvo.ca/ten-things-to-know-about-the-liberal-partys-housing-platform/

Liberal party&#8217;s housing platform

Published by Anonymous (not verified) on Wed, 01/09/2021 - 10:25pm in

With a federal election taking place in Canada in fewer than three weeks, I’ve written a 950-word overview of the Liberal Party’s housing platform.

It’s available here: https://nickfalvo.ca/ten-things-to-know-about-the-liberal-partys-housing-platform/

Monthly digest on housing affordability and homelessness – July/Aug 2021

Published by Anonymous (not verified) on Tue, 31/08/2021 - 4:55am in


Housing, Politics

The following is the latest instalment of a monthly digest of interesting articles, research reports, policy announcements and other material relevant to housing stress/affordability and homelessness – with hypertext links to the relevant source.

Changes to Tasmania’s reporting on government supported housing. The Tasmanian government recently announced changes to the way it reports its support for social and affordable housing.  The new monthly format is a welcome advance on the previous quarterly reporting and expands the range of data provided.  Included in the data are detailed supply and demand indicators, along with the key economic and other metrics.  The new reporting covers the State’s efficiency of use of its social housing dwellings.  In announcing the above changes, the government mentions its record recent investment of $615 million into social and affordable housing and homelessness initiatives, including its election commitment of $280 million to extend its building program of new social housing, claiming it as “the biggest in this State for decades”.  Tasmania has committed to building a total of 3,5000 new social dwellings by 2027.  see also Revamped Tasmanian Housing Dashboard – June 2021, and Reporting on housing outcomes in Tasmania

What is build-to-rent?  Alasdair Duncan describes the nature of and participation in build-to-rent (BTR) residential development.  He says BTR is long-established in Europe, comprising nearly a fifth of the entire market as of early 2020.  Australia is a relative newcomer to BTR, but now has an estimated 10,000 BTR apartments in the pipeline from various residential developers, including Mirvac.  Duncan says BTR developments offer a number of potential benefits to tenants, including more flexible lease arrangements than other types of rentals (including longer security of tenure), a variety of included amenities, and the potential for affordable housing.  He observes, however, that there are several potential downsides to the BTR model, including that they can cost more on average than other rental properties, in part because they come with more amenities attached.  It is hoped that BTR developers will, with appropriate government subsidies and other incentives, allocate a proportion of their units towards affordable housing.   A Queensland Government supported BTR Pilot Project, for example, will see 2 projects include 240 apartments with “discounted rent”, designed to provide homes for people who need to live in Brisbane’s inner city but have been priced out of the rental market.

Taxing the family home the ultimate in pariah policies  This edited extract is from “Who Dares Loses: Pariah Policies” by Wayne Errington and Peter van Onselen – part of Monash University Publishing’s ‘In the National Interest series’.  Errington and van Onselen lament the political difficulties of major tax reform in Australia.  However, they note (with support) the opportunity for state governments to take the bold step of embracing tax reform related to the family home, by replacing the productively inefficient and unpredictable stamp duty regime with an annual land tax.  Errington and van Onselen say: “Moving from stamp duty on property transfers to a greater reliance on an annual tax on the unimproved value of land would swap one of the least-efficient government charges for one of the most efficient.  Labour could be more mobile in search of better wages and conditions, and a shorter commute; capital could be more lightly taxed…Tax on land is transparent, difficult to evade, and easy to calibrate for equity purposes.”  The NSW Government has already indicated its willingness to contemplate going down the route of replacing stamp duty with a broad-based land tax, as indicated in the 28 June 2021 instalment of this Monthly Digest.

‘Housing for hippies now for hipsters’: Alternative plan to boost affordability  SMH journalist, Angus Thompson, reports that “Co-living, a trendy new wave of communal housing championed by millennials, will be automatically approved in all areas [of NSW] where apartments are allowed in order to flood NSW with affordable development. Seniors will also be housed in ‘vertical villages’ that could be in the middle of CBDs or on top of shopping centres under new planning changes to boost housing options amid an affordability crisis and shortages of supply.”  The planning rule changes, being driven by NSW Planning Minister Rob Stokes, envisage a range of non-bedroom facilities such as workspaces, dining spaces, kitchens and storage spaces being able to be shared.  Co-living is part of the evolution of the so-called ‘sharing economy’.  The success of the latest planning changes will depend in part on whether the federal government introduces appropriate concessions under relevant federal tax rules, particularly relating to GST.  See also Developer reps slam proposed boarding house and co-living changes for NSW

Return on investment for social housing in the ACT  This research paper, commissioned by ACT Shelter and authored by AHURI’s Jim Davison, Dr Nicola Brackertz and Dr Tom Alves, quantifies the estimated savings to the ACT government from providing direct access to planned, sustainable, long-term housing options for the homeless, and those at risk of homelessness.  The authors estimate that the cost-of-service use for those stably housed is around $15,300 per person per year lower than for those who are homeless, findings which they say are broadly consistent with other comparable studies in Australia.  They acknowledge, however, that there is a wide disparity in the cost-of-service use amongst those experiencing persistent homelessness, showing that cost offsets are more apparent for some high needs’ clients.  They calculate a benefit cost ratio ranging from 0.29 to 0.57, representing the proportion of the subsidy needed for new community housing that could be recouped through welfare cost offsets (in terms of health, justice and welfare support). This means that for every dollar the government spends on a new house, it would recoup between 29 and 57 cents through benefits in welfare offsets, depending on the quality of such housing.  In short, the research findings support the case for investing in more social housing, an important form of social infrastructure that provides a safety net for those most in need (and improved health, safety, employment, wellbeing, and empowerment of its occupants), as well as productivity benefits for society more broadly. It is noted that there are currently around 2,500 persons on the social housing waiting list in the ACT, a figure projected to increase to 8,500 by 2036.

Housing equality – a better future for all Australians  Mark Steinart, the recently retired managing director of Stockland, offers his thoughts on the role of the private sector in achieving housing equality.  He notes that one of the main causes of house price inflation in recent years has been the rapid increase in land values, which have risen materially faster than construction costs.  He attributes this rapid land price inflation to: an undersupply of suitably zoned and serviced land, which largely reflects strong demand growth; complex, inefficient planning policies, which mean rezoning can take up to 10 years; and lagging infrastructure provision.  He also identifies the growth of government charges, and says HIA estimates that costs associated with the planning process represent 25% to 35% of the price of new housing. He regrets the NIMBY (“Not In My BackYard”) attitudes of some community residents, who object to increased density in their suburb or immediate surrounds, thereby contributing to a slowing of the necessary densification of middle-ring suburbs, which typically have good access to infrastructure (including public transport), services and job opportunities.  At the same time, he lauds the new metropolitan rail infrastructure that we have seen in the last 5 years, particularly in Sydney, Melbourne and Brisbane, the first significant heavy rail development in these capital cities in 50 years. Combined with the master planning of near station land use, and the provision of a range of transport interchange services and facilities, this has in his view helped address affordability, inequality and economic growth.  Steinert posits: “Density done well is the key to improving affordability and livability, enabling younger generations to buy or rent a home and older generations to downsize in suburbs where they live.”  He calls for “a new approach from all stakeholders to put the needs of our whole community first, enabling the use of scalable master planning to develop better communities”.  In short, more YIMBY and less NIMBY.

The invisible problem of death on our streets  Pro Bono Australia journalist, Nikki Stefanoff reports that an estimated 424 people experiencing homelessness died on Australia’s streets over the past 12 months, though the true number may be much higher, as there is no consistent data collected or recorded on the deaths of people experiencing homelessness across Australia – hence the relative “invisibility” of this cause of death.  These findings emerge from research conducted by the Australian Alliance to End Homelessness (AAEH) in collaboration with University of Western Australia’s Home2Health team, which identified 56 Perth residents who died last year while sleeping rough, or after a long-term experience of rough sleeping.  David Pearson, CEO of AAEH, says a “by-name list” of rough sleepers (ie. A list of everyone who’s sleeping rough) can play an important role in getting more accurate data about deaths from homelessness.  He calls for the Commonwealth government to take leadership on the issue, and to task the Australian Institute of Health and Welfare with creating a measurement framework, arguing “you can’t change what you don’t measure”.

Final report of Federal Parliamentary enquiry into homelessness  The federal parliament has recently released the Final Report of the House of Representatives Standing Committee on Social Policy and Legal Affairs, relating to its “Inquiry into homelessness in Australia”, following its Interim Report in October 2020.  The Final Report makes 35 recommendations, including the need for a national approach, even though state and territory governments are primarily responsible for housing and homelessness.  The Committee recognises that “a national strategy would lead to more cohesive policies, better coordination and more accountability, particularly in relation to the use of Australian Government funding…. [and] also recognise and harness the important roles of local governments, community organisations and the private sector in preventing and addressing homelessness.”  Three main reform principles were identified.  First, prevention and early intervention represent the most effective and cost-efficient measures to address homelessness.  Second, the principle of ‘Housing First” should guide all Australian governments’ responses to homelessness, along with flexible ‘wrap-around’ services to prevent homelessness and associated problems from becoming entrenched.  Third, new approaches are needed to address the shortfall in social and affordable housing.  The Committee supports the design of a new “needs-based funding model for future funding agreements between the Commonwealth and the states and territories as well as particular measures to assist groups such as victim-survivors of family, domestic and sexual violence, and Indigenous Australians.”  The recommendations include measures to improve data collection and reporting, to better inform all levels of government, and a review of how homelessness is defined and homeless counted in the Census.  See also Federal Government investment into homelessness “falls short” and Advocates hope homelessness report marks new era of Commonwealth  engagement

Giving hope: Housing our essential workers  This news item from the Centre for Social Impact (CSI) tells the story of an interesting and potentially exciting start-up social enterprise, HOPE Housing, which (with CSI’s design and impact measurement help) is seeking to address the increasing challenges faced by so-called “essential workers” in finding affordable housing within reasonable proximity to where they work.  Essential workers typically include the likes of teachers, nurses, police officers and firefighters.  The model being pursued by HOPE is a relatively simple idea deployed in other parts of the world, but apparently not so common in Australia: “HOPE will co-invest as a passive shared equity partner, buying 50% of a home, with a frontline worker purchasing the other 50% through a mortgage from HOPE Housing partner, Police Bank.  The frontline worker will be under no obligation to buy out HOPE, but should they sell the property the fund receives a proportional share of the proceeds.”  Tim Buskens, CEO of HOPE Housing, says the social enterprise is targeting a 10% commercial return from the venture, but at the same time forecasting a positive social impact of around 30 cents for every dollar invested.  HOPE is working towards the roll out of their first affordable housing project.

Exiting prison with complex support needs: the role of housing of housing assistance  This AHURI report, authored by a group of academics from University of NSW, University of Tasmania and RMIT, powerfully supports the case for providing public housing to ex-prisoners, particularly those with complex support needs.  The case for doing so is made out not only due to the benefits to ex-prisoners as they seek to re-enter society (a worthy objective in itself), but also importantly because it generates significant savings to the public purse, and provides a better outcome for the community as a whole.  The report concludes: “Ex-prisoners with complex support needs who receive public housing have better criminal justice outcomes than comparable ex-prisoners who receive private rental assistance only.  Public housing ‘flattens the curve’ of average predicted police incidents (down 8.9% per year), time in custody (down 11.2% per year), justice system costs per person (down $4,996 initially, then a further $2,040 per year), and other measures.  In dollar terms, housing an ex-prisoner in a public housing tenancy generates, after five years, a net benefit of between $5,200 and $35,000 relative to the cost of providing them with assistance in private rental and/or through homelessness services.” The lessons from this research are even more important at a time when imprisonment in Australia is growing, with associated increases in ex-prisoner housing need, and housing assistance capacity is declining.  See also Experts say public housing the key element to stop ex-prisoners re-offending


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the federal Conservatives’ housing platform

Published by Anonymous (not verified) on Tue, 24/08/2021 - 7:03am in

With a federal election taking place in Canada on September 20, I’ve written an 800-word overview of the Conservatives’ housing platform.

It’s available here: