Methods for determining the level of economic security in the field of housing construction
The indicators that can be used in assessing the level of economic security in the housing construction market are determined and the most universal systems for calculating the level of economic security in the housing construction industry are identified. It is substantiated that there are approaches to determining the level of economic security in the field of housing construction, which basically come down to calculating the housing affordability index for the population.
There are different approaches to determining the level of economic security in housing construction. Basically, they come down to the calculation of the housing affordability index for the population. In our opinion, to determine the level of economic security and develop measures to maintain it at the required level, contributing to the development of housing construction and providing citizens with affordable housing, it is not enough to calculate one index, the affordability of housing depends on a number of factors, both on the demand side (the level of real incomes of citizens , unemployment rate, etc.), and on the supply side (volume of housing construction, housing area per person, etc.). Accordingly, these indicators should be used to assess the level of economic security in the field of housing construction. Indicators for determining the level of economic security in the field of housing construction can, in our opinion, be divided into 2 groups. The first group includes indicators relating to the volume of commissioning of housing per capita, the total area of residential premises per inhabitant in cities and rural areas, the volume of dilapidated and dilapidated housing. The second group includes indicators affecting the level of income and employment of the population, the share of the population with income below the subsistence level, the index and the coefficient of housing affordability. Determination of threshold values of indicators is an important tool for system analysis and forecasting.
Thresholds can be used to assess trends in the economy, in particular in housing construction, against national interests. Threshold values should be approved at the state level and compliance with them should be an element of government programs. At the same time, it should be noted that changes in the threshold values of indicators in order to comply with modern realities or forecast indicators should not be allowed. Threshold values should become a guide, any deviation from which should show the degree of threats to economic security and be interpreted as the need to take appropriate measures to neutralize them [1].
It is important that the threshold values of indicators for assessing the level of economic security in the field of housing construction meet the following criteria:
- the possibility of quantifying the indicator;
- the ability to assess the state of the economy over time;
- reflect the importance of the primary indicators of the sphere of economic security, allowing you to quickly respond to the emergence of threats [1].
Consider the indicators and their threshold values in more detail. The first group of indicators (housing supply indicators) includes such an important factor as the volume of commissioned housing per capita compared to the national average. The threshold value here is taken to be at least 100%, since the volume of housing commissioning in the region, per capita, should not be lower than the national average. The next indicator in the same group is the total area of dwellings per inhabitant in urban and rural areas. In the calculation of this indicator, this value will be considered as the minimum threshold [2]. The indicator assessing the state of the housing stock is the share of dilapidated and dilapidated housing in the total volume of the housing stock in the region.
To assess security in terms of demand for housing, it is necessary to apply a number of indicators related to the second group. The first of these is the housing affordability index, which is calculated in terms of the number of years it takes for an average family to accumulate funds to buy an average home. The solution to the problem of providing the population with affordable housing to a certain extent depends on the solvency of citizens. Solvency, at the same time, is calculated by the ratio and dynamics of the income level of the population and housing prices. The ratio between prices in the housing market and incomes of citizens reflects the affordability of housing and can be calculated as an indicator of affordability that determines the population’s ability to purchase housing. The lower the value of this indicator, the better, since it will indicate that it takes fewer years to accumulate funds to buy an average apartment for a family. There are several approaches to calculating this indicator, which entails obtaining different results.
References
- Cherenko, L.M. (2018). Zhytlovi umovy naselennia Ukrainy ta vybir priorytetnykh napriamiv zhytlovoi polityky [Housing conditions of the population of Ukraine and the choice of priority areas of housing policy]. Demohrafiia ta sotsialna ekonomika - Demography and social economy, 1(32), 126-139. - https://doi.org/10.15407/dse2018.02.126 [in Ukrainian].
- Reut, A.G. (2017). Evoliutsiia zhytlovykh umov pid vplyvom sotsialnykh zmin [Evolution of housing conditions under the influence of social change]. Demohrafiia ta sotsialna ekonomika - Demography and social economy, 3(31), 174-185. - https://doi.org/10.15407/dse2017.03.174 [in Ukrainian].
- Gifford Robert (2007). The Consequences of Living in High-Rise Buildings. Architectural Science Review, Vol. 50, 1. Retried from https://doi.org/10.3763/asre.2007.5002