NERI report on Housing Provision in NI – living standards and poverty

The Nevin Economic Research Institute (NERI) recently published a working paper assessing the sufficiency and affordability of housing in Northern Ireland and the implications which housing costs have for living standards.

Overall, there does not seem to be a misallocation in supply and demand in terms of housing provision across Northern Ireland. However, there is a considerable shortage of social housing in regions of high demand such as Belfast and Derry and Strabane districts.

Findings from the private rented sector

While the report finds housing in Northern Ireland appears to be affordable, there are particular groups who are significantly impacted by housing costs, specifically low income households in the private rented sector. Findings in relation to the private rented sector show:

• The proportion of people who privately rent homes has almost doubled between 2005/06 (just over 10%) and 2015/16 (just over 19%).
• Approximately 50% of 18-34-year-olds rent privately.
• Housing costs for low-income households in the private rented sector are statistically significantly higher than for those in other tenures.
• 25% of households in the private rented sector are at risk of poverty after housing costs, this equates to approximately 34,000 households.
• Higher proportions of those at risk of poverty after housing costs come from working households, single or couple households, and are aged 18-34.
• Poverty amongst low income households in the private rented sector is not impacted by other factors and it is specifically housing costs that are key in terms of the negative impact on living standards.

The paper concludes that low income households face housing cost burdens and are at risk of poverty. It is suggested that the social rented sector should be expanded to low-income privately renting households move into it.

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