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Setting the scene – evidence of changing household behaviour?

Setting the scene – evidence of changing household behaviour?. Christine M E Whitehead LSE London HEIF Event: the new population and household projections: implications for London LSE, 1 July 2013. Some History.

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Setting the scene – evidence of changing household behaviour?

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  1. Setting the scene – evidence of changing household behaviour? Christine M E Whitehead LSE London HEIF Event: the new population and household projections: implications for London LSE, 1 July 2013

  2. Some History • Household projections for many years consistently underestimated actual growth in household numbers from given population • Main reasons: longevity; age structure; income growth – we don’t like living together ; • However in 2000s, household projections started to overestimate household growth – particularly in London

  3. By the mid 2000s • Suggested projections were overestimating actual household formation between 2001 and 2006 by between 35,000 and 40,000 households per annum • Two main reasons: - high levels of in-migration assumed but recent immigrants form fewer households during the first few years; - housing market pressures reducing the capacity to set up as separate households especially in high cost areas such as London (household formation among younger households started to drop in 1990s) • By the 2008 based projections stronger evidence of both the impact of recession and of in-migrant impacts – but no capacity to adjust projections

  4. The Big Differences in 2011 • Population higher than ‘expected’ plus half a million • Number of households lower – minus 375,000 • Some concern that 2001 population was too low so trajectories are difficult to discern • Large differences in household types - notably one person, couples plus adult and other multi-person households 4

  5. Long term trend in household size • Census 2011 found more people but fewerhouseholds than expected. • No fall in household size, despite ageing population • What were the changes? • A new trend or a blip? 5

  6. Household type changes 2001 - 2011 • Couples with no other adults. • Projected tend change +428,000; actual increase +314,000. • Partly offset by • Couples with one or more other adults. • Projected trend change -365,000, actual change +218,000. • Lone-parent households. • Projected trend change +373,000, actual change +274,000. • Other multi-person households. • Projected trend change -40,000, actual change +291,000. • One-person households. • Projected change +1,469,000, actual change +481,000. 6

  7. Household Projections and Estimates for England 1991-2021 7

  8. Differences between Trend Projection and Actual Change 2001 – 2011

  9. Easy Explanations: Demographics? • Since 2001, 30 years of continuity broken • Younger people unable to form separate households because of debt; house prices and rents; uncertainties about employment etc • Living with their parents or in multi –adult households in the prs • Impacts on the household structure of older households • But the growth in multi-person households concentrated in middle age and also changes in older household behaviour which aren’t just about men living longer

  10. Easy Explanations: Economics and Social • Recession and the depressed housing market has done little to improve affordability in pressure areas • Uncertainties around employment opportunities • Difficult access to the owner-occupied market • Those in the prs consume less housing as compared to equivalent people in owner-occupation • Fewer separations /more re-partnering among 35 – 60s • Little direct evidence on causes

  11. Using these figures for projections • How much notice to take of 2011? • Is it an outcome of recession and other shorter term issues? • Is it partly an outcome of housing market issues – affordability/shortages? • A 3 point or a 2 point projection • Shorter term v longer term trends – will we return to ‘normal’ or is (to be annoying) the new normal? – or more likely somewhere in between 11

  12. Conclusions: Planning in a period of uncertainty • We need a baseline for assessing future needs – for all types of social services and financial allocations , not just housing • Projections must assume past economic trends – but a major issue when turning points • Could we use a behavioural model a la Barker/Meen – equally problematic but more behavioural • Major risks in planning for the next decade as if it were an extension of the 2000s • Cannot know either about economic outcomes let alone capacity to form separate households - so are we just guessing? 12

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