Estimated net income distribution of working households by household type and locality

Landlords in the social rented sector are currently in need of delivering more hybrid housing options – most notably the Affordable Rent (AR) Programme. The target of 80% of market rents implies prospective tenants will be on moderate, but not the lowest, incomes, and are thus less likely to be on Housing Benefit; an appropriate or optimal level of AR in each local market is still not settled, and is the subject of debate amongst housing providers. One of the bases for setting an AR is household income net of income-related benefits, such as Housing Benefit. Calculating this is not easy because of lack of detailed information on household income components in local areas. For instance, the Family Resource Survey (FRS), commissioned by DWP, has critical data on household incomes but only at very limited geographical levels. There is also a considerable time lag between data collection, publication and use in the planning context for housing provision. Using Bromley as an example we estimate net income distribution for eight household types at Mid-Super Output Area (MSOA) level, for July 2014, using micro-simulation models developed from our own experience and studies.