Housing and Covid-19 by Willem Adema

HOUSING AND COVID-19

Willem Adema, Senior Economist willem.adema@oecd.org OECD Directorate for Employment, Labour & Social Affairs 14 May 2020

The unfolding Covid-19 pandemic brings to the fore many housing challenges facing households.

• Housing vulnerability is a reality for many – Many households – especially renters – are overburdened by housing costs

• Sheltering in place is not effective or possible for everyone – People living in overcrowded or poor quality housing – People without access to a computer or the Internet at home – Victims of domestic violence – The homeless

Low-income households are more likely to live in overcrowded dwellings which poses challenges to physical distancing Share of overcrowded households, by quintiles of the income distribution, in percent – 2017 or latest year available bottom quintile

3rd quintile

top quintile

60% 50% 40% 30% 20% 10% 0%

Notes: 1. No information available for Australia, Canada, New Zealand and Turkey. See section "Data and comparability issues" of Indicator HC2.1 on limits to comparability across countries due to the definition of rooms. 2. Low-income households are households in the bottom quintile of the (net) income distribution. In Chile, Mexico and Korea gross income is used due to data limitations. 3. Results only shown if category composed of at least 30 observations. 4. Data for Japan only available on the respondent level due to data limitations. 5. The definition of overcrowding is based on Eurostat. For a full explanation, see: www.oecd.org/els/family/HC2-1-Living-space.pdf.

Source: OECD Affordable Housing Database, Indicator HC2.1

Adolescents (age 15) in low-income households are least likely to have a computer and access to the internet 2018 Percent of 15-year-old students who report having a computer they can use for school work and a link to the internet in their home, by index of economic, social and cultural status (ESCS), 2018 Total

1st quartile (lowest)

4th quartile (highest)

100 90 80 70 60 50 40 30 20 10 0

Notes:: The PISA index of economic, social and cultural status (ESCS) is a composite measure used to estimate a student's socio-economic background. The index is derived from several variables related to students’ family background: parents’ education, parents’ occupations, a number of home possessions that can be taken as proxies for material wealth, and the number of books and other educational resources available in the home. The index itself is a composite score derived from these indicators via Principal Component Analysis (PCA). Here, however, students are divided into quartiles according to their position in the distribution of ESCS scores in their country or economy. The relatively low score for Japan (compare to its GDP per capita) is driven by the comparatively low rate of student (62%) with access to computers for schoolwork, while (95%) have access to a link to the internet.

Source: OECD Child Well-Being Data Portal

Many OECD countries have put in place emergency, temporary housing measures in the wake of COVID19 - Feedback Welcome Type of measure / support

Country *Measure applies only to some jurisdictions/cases

For tenants: • • • • •

Prohibit evictions due to missed payments Deferment of rent payments Temporary reduction or suspension of rent payments for some households Prohibit rent increases Reforms to financial support for renters

• • • • •

Australia*, Belgium*, Canada, France, Ireland, Israel*, Luxembourg, Netherlands, Spain, UK, US* Germany, Spain* Greece, Portugal, Spain* Ireland, New Zealand, Spain* Ireland, Luxembourg, Spain

• •

Australia*, Belgium, Ireland, Israel, Portugal, Slovak Republic, Spain, UK US*, the Netherlands

•

Belgium*, Colombia, Germany, Japan, Korea, Spain, US*

•

France (postponement of planned reform), Spain

For homeowners: • •

Deferment of mortgage payments Prohibit foreclosures due to missed payments

For all households: • Deferment of utility payments and/or continued service even if payment missed • Reform to housing subsidy For the homeless: • Emergency support to provide shelter to the homeless

•

Canada, France, Ireland*, New Zealand, Spain, UK, US*

For more information: http://oe.cd/covid19tablesocial willem.adema@oecd.org

Emerging questions • Are countries tracking the housing impacts of COVID-19?

• How and when can governments most effectively phase out the different forms of temporary emergency housing support? Will some measures need to remain in place longer than others?

• To what extent were emergency support measures effectively targeted, e.g. to renters, to homeowners, to vulnerable populations, etc.?

• To what extent has COVID-19 extended the group of people who are “housing vulnerable” ?

• How can governments build a more resilient housing system? How might current housing policies need to be adapted post-COVID?