Home ownership as a status symbol for older people

When social researchers and policy people want to examine trends in their relevant populations they often “dissagregate”, that is separate out groups of people by their characteristics. Thus, we are used to totals by gender, by ethnicity, by age and by socio-economic status. None of these characteristics is clear-cut. You may have noticed that as well as male and female there is often another choice, such as “gender diverse”. Many people have affiliations to more than one ethnic group – so how can we be sure about the proportions of Maori, Pakeha/European and so on.

But, despite this, there are a lot of links between certain population groups and their general experiences, such as health status. Women tend to live longer than men. Maori are more likely to suffer from cardiovascular disease than Pakeha. These differences have significance for policy and service development.

A characteristic which plays a large part in social analysis and which has significant policy implications is socio-economic status (SES) or socio-economic position (SEP), sometimes called class or social advantage/disadvantage. The most commonly used indicators for studying SES are income, occupation and educational qualifications. For example, NZDep is a national index derived from census data, and has indicators of income, employment, education, home ownership, household overcrowding, transport, support and telecommunications. It is applied to geographical areas and is used to pinpoint levels of social deprivation, hence special funding for schools and other services.

But how can the SES of older people (65 plus) be measured when they are no longer in paid work, and who may have their income fixed by national policies? This is a key question which Associate Professor Daniel Exeter and his team at the University of Auckland are exploring as part of their Marsden-Funded project. Older populations are likely to have received limited secondary and tertiary education. The applicability of the usual indicators decreases with age. For example, instead of current occupation, sometimes “last occupation prior to retirement” is used in SES measurements. But this may not be a correct representation of an individual’s main occupational status through life. Prior to full retirement, many older people have less demanding jobs as transitional or as supplementary to a retirement lifestyle.

Is housing tenure a good indicator of socio-economic status?

In her Master’s thesis, Olivia Heatley, one of the Auckland team (supervised by Daniel Exeter and Dr Nichola Shackleton), addresses this question and concludes – “Current measures designed for working age populations do not accurately reflect the position of those adults aged ≥65.”[1] The aim of her thesis was to create a census-based measure of SES in older people in New Zealand and hence to provide a means to help target the distribution of resources to vulnerable older groups – a growing policy challenge as the population ages.

After pointing out how other SES measures may be less appropriate for older people, Olivia discusses using housing tenure. It is regularly collected in major surveys which cover the vast majority of the population.[2] Funds tied up in housing are likely to make up a sizeable proportion of older people’s assets (if not their only asset). As such, they can be a measure of accumulated wealth and can illustrate the cumulative advantage or disadvantage individuals have experienced over time. Research results show that house value is highly associated current health status.

“Housing tenure provides one of the most fundamental bases of financial and social well-being in old age” (Kendig, 1984).

A measure of SES in older people based on housing tenure should distinguish between outright homeowners and those with a mortgage. Mortgage free status brings the benefit of much reduced housing costs. Older people with a mortgage-free home are more likely to find NZS payments sufficient for their weekly expenses.  There also needs to be a distinction between owners and renters (private and public rental accommodation). The ownership of a private dwelling is likely to reflect higher levels of education and income than the situation of those who are still making substantial rental (or mortgage) payments.

A SES (SEP) measure for the older population
Olivia’s research provides a new measure of socio-economic position, dividing the ≥65 population (excluding those in non-private dwellings) into three distinct groups: low, medium and high socioeconomic position (SEP).

Low SEP – The main marker of low SEP is living in public rental accommodation, but also people renting privately and owning a home with a mortgage.

Medium SEP – Represents those who may not be wealthy but are still in a stable financial position. They may still be homeowners with a mortgage or renters, but a series of further financial indicators must come into the assessment.

High SEP – The main marker of high SEP is a mortgage free home. Literature surrounding housing tenure and owner occupation consistently shows better health outcomes for those who own their home compared to other tenure arrangements.

On this basis, 20% of older people can be classified as in low SEP; 59% in medium SEP; 22 % in high SEP. This is a very simplified outline of the proposal but does suggest the importance of housing tenure to the wellbeing of the older population.

As part of the Marsden Funded project, the Auckland team are producing a preliminary Older People’s Index of Multiple Deprivation (OPIMD) which uses 15 indicators of deprivation reflecting the social conditions of the 65 plus population.

[1] Healey, O. R. (2018). The Forgotten Generation: Creating a census-based measure of socioeconomic position (SEP) for the ≥65 population The University of Auckland. ResearchSpace@Auckland.

[2] It does, however, exclude older people living in institutional care.

 

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About Age Concern New Zealand 'on research'

At the heart of everything Age Concern does is a passion to see older people experience well-being, respect, dignity, and to be included and valued. We support, inform and advise older people on issues such as access to health care, transport, housing, financial entitlements, and social opportunities. We also work to combat real problems in our society, like elder abuse and neglect, chronic loneliness and social isolation. We provide specialist services with trained and qualified professionals able to give expert advice and assistance. Age Concern is a charity and relies on the support of volunteers and public donations to do much of the work we do. To help us help older people, please consider making a donation of your time or money. To see how, visit www.ageconcern.org.nz
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