Exploring the many housing elasticities of supply: The case of Australia
The housing elasticity of supply (HES)—how housing supply responds to price rises—has been a major preoccupation of policymakers in the face of worsening housing affordability in many countries. Yet we lack an understanding of just how this quantity varies across regions, and within cities, or the f...
| Main Authors: | , , |
|---|---|
| Format: | Journal Article |
| Language: | English |
| Published: |
ELSEVIER SCI LTD
2022
|
| Subjects: | |
| Online Access: | http://purl.org/au-research/grants/arc/FT200100422 http://hdl.handle.net/20.500.11937/89881 |
| _version_ | 1848765293805961216 |
|---|---|
| author | Melser, D. ViforJ, Rachel Wood, Gavin |
| author_facet | Melser, D. ViforJ, Rachel Wood, Gavin |
| author_sort | Melser, D. |
| building | Curtin Institutional Repository |
| collection | Online Access |
| description | The housing elasticity of supply (HES)—how housing supply responds to price rises—has been a major preoccupation of policymakers in the face of worsening housing affordability in many countries. Yet we lack an understanding of just how this quantity varies across regions, and within cities, or the factors which drive it. We address this question by estimating the HES for 341 spatially disaggregated Australian local government areas (LGAs) from 2001 to 2019 for houses and units (attached homes). Our estimates document considerable variation in HES estimates across LGAs. For houses it ranges from 0.17 at the 25th percentile to 0.44 at the 75th percentile while for units it varies between 0.56 and 1.17. Interestingly, we find no correlation between the LGA HES estimates for houses and units. We explore how variation in the local HES relates to potential housing supply drivers such as accessibility to central business districts, topography, temperature range, annual precipitation, and political orientation. The most important driver of the HES is accessibility—LGAs on the city-fringe have the highest HES for houses, while for units it is highest in the inner-city. We find political orientation and annual precipitation have some impact on the HES for units. |
| first_indexed | 2025-11-14T11:32:57Z |
| format | Journal Article |
| id | curtin-20.500.11937-89881 |
| institution | Curtin University Malaysia |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-14T11:32:57Z |
| publishDate | 2022 |
| publisher | ELSEVIER SCI LTD |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | curtin-20.500.11937-898812024-07-03T05:31:29Z Exploring the many housing elasticities of supply: The case of Australia Melser, D. ViforJ, Rachel Wood, Gavin Social Sciences Urban Studies Housing elasticity of supply Urban and regional economics Local government areas Australia Instrumental variables PRICE ELASTICITY RESIDENTIAL CONSTRUCTION GROWTH POLICY DETERMINANTS MARKET IMPACT MODEL EDGE The housing elasticity of supply (HES)—how housing supply responds to price rises—has been a major preoccupation of policymakers in the face of worsening housing affordability in many countries. Yet we lack an understanding of just how this quantity varies across regions, and within cities, or the factors which drive it. We address this question by estimating the HES for 341 spatially disaggregated Australian local government areas (LGAs) from 2001 to 2019 for houses and units (attached homes). Our estimates document considerable variation in HES estimates across LGAs. For houses it ranges from 0.17 at the 25th percentile to 0.44 at the 75th percentile while for units it varies between 0.56 and 1.17. Interestingly, we find no correlation between the LGA HES estimates for houses and units. We explore how variation in the local HES relates to potential housing supply drivers such as accessibility to central business districts, topography, temperature range, annual precipitation, and political orientation. The most important driver of the HES is accessibility—LGAs on the city-fringe have the highest HES for houses, while for units it is highest in the inner-city. We find political orientation and annual precipitation have some impact on the HES for units. 2022 Journal Article http://hdl.handle.net/20.500.11937/89881 10.1016/j.cities.2022.103817 English http://purl.org/au-research/grants/arc/FT200100422 http://creativecommons.org/licenses/by-nc-nd/4.0/ ELSEVIER SCI LTD fulltext |
| spellingShingle | Social Sciences Urban Studies Housing elasticity of supply Urban and regional economics Local government areas Australia Instrumental variables PRICE ELASTICITY RESIDENTIAL CONSTRUCTION GROWTH POLICY DETERMINANTS MARKET IMPACT MODEL EDGE Melser, D. ViforJ, Rachel Wood, Gavin Exploring the many housing elasticities of supply: The case of Australia |
| title | Exploring the many housing elasticities of supply: The case of Australia |
| title_full | Exploring the many housing elasticities of supply: The case of Australia |
| title_fullStr | Exploring the many housing elasticities of supply: The case of Australia |
| title_full_unstemmed | Exploring the many housing elasticities of supply: The case of Australia |
| title_short | Exploring the many housing elasticities of supply: The case of Australia |
| title_sort | exploring the many housing elasticities of supply: the case of australia |
| topic | Social Sciences Urban Studies Housing elasticity of supply Urban and regional economics Local government areas Australia Instrumental variables PRICE ELASTICITY RESIDENTIAL CONSTRUCTION GROWTH POLICY DETERMINANTS MARKET IMPACT MODEL EDGE |
| url | http://purl.org/au-research/grants/arc/FT200100422 http://hdl.handle.net/20.500.11937/89881 |