Residential Location and Household Expenditures for Transport and Housing: the example of the Greater Paris region Akli BERRI INRETS-DEST COST 355 WG 1 & 2 Piraeus meeting, April 2006.

Transport and housing interplay Residential location strongly influences car ownership and use  Availability of public transport according to the degree of urbanisation and population density  Congestion problems in dense areas Choice of residential location  Travel time (to work, shopping, etc.)  Housing prices  Owning a house; living in a “likely-country” environment What does this interaction imply in terms of budgetary efforts devoted to transport and housing? What about the reality of a trade-off between transport and housing?

Polacchini & Orfeuil study (1998) Greater Paris region: 9 zones according to property prices (private sector)  Home buyers and households renting non low-cost accommodation  Expenditures estimated from two surveys: Comprehensive Transport Survey (1991) and Residential Mobility Survey (1994) As one moves from the centre to the periphery…  … the budget share of transport increases, while that of housing remains roughly constant  … household size and the percentage of home-buying households increase, while income per CU falls  … travel-time budget does not vary to a marked degree, despite large differences in the distances covered Constrained location far from the centre, at least for low income households (particularly if they wish to become home-owners)

Data and zoning Household Expenditure Surveys: , , 1989 and  All households  By zone of residence, standard of living and dwelling occupation status 4 concentric zones preserving the hierarchy of property prices  City of Paris  Inner suburbs  Outer suburbs  Periphery Expenditure groupings  Private transport: vehicle purchases (incl. leasing); insurance; fuels, lubricants, tires and accessories; maintenance and repair; garage rent; parking costs; tolls; car registration and annual taxes; fines  Local public transport  Housing (principal residence): rent and expenses; reimbursements of loans for purchase, construction and restoration; maintenance and equipment; heating and lighting; taxes; insurance

Source : INSEE ; calculations performed by INRETS. Changes in prices in the Greater Paris Region (Relative price indices: baseline 100 in 1978 )

Motorised households (%)

Cars per household

Housing budget shares (%) Note: Share of the amount net of housing subsidies.

Private transport budget shares (%)

Local public transport budget shares (%)

Source : INSEE Household Budget Survey, Budget shares of transport and housing, by zone of residence

Source : INSEE Household Budget Survey, Socio-economic characteristics and housing conditions of households, by zone of residence

(*) Amounts in Francs (period of the last survey).

Low-cost accommodation and housing subsidies, by zone of residence

Recently built dwellings, by zone (%)

Home-buyers and home-owners outright living in a house (%) Recent movings in by zone – Home-buying households (%)

Budgetary constraints and property prices force low income households to live in peripheral zones (particularly if they wish to become home-owners) Evaluation procedures by banks and lessors  Only housing expenditures are accounted for  Peripheral location; favour urban sprawl  “Driven to spend” more on transport

Conclusions Evaluation of solvency of households  Taking into account transport expenditures, in addition to those for housing  Maximum housing shares (of income) may depend on the accessibility of the zone by public transport Policies to reduce car use  An integrated approach of transport and housing  Actions on the housing market to attenuate urban sprawl: solvency evaluation; promotion of low-cost accommodation in zones accessible by public transport; a land use planning (densification of the urban fabric, mixing dwellings and jobs)  Conciliate car use reduction measures and equity  Low income households dependent on the car : a uniform increase of utilisation costs (e.g. fuels) would be unfair  Area-specific measures: access restrictions, urban toll, …  Improving public transport supply (service, frequency, comfort, punctuality)

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