Housing affordability stress and mental health: The role of financial wellbeing

Abstract Using data from wave 20 of the Household, Income and Labour Dynamics in Australia Survey, we provide a descriptive examination of the relationship between housing affordability stress (HAS) and a multi‐item measure of financial wellbeing across tenure types and test whether good financial wellbeing is protective of the negative mental health effects of HAS. We find that HAS is associated with lower financial wellbeing and that this is differentially distributed by tenure, with renters who experience HAS reporting, on average, lower financial wellbeing than owners. This suggests that HAS, which focuses on income to define housing stress, is different to financial wellbeing. Being in control of finances and feeling financially secure are important components of the way in which financial hardship impacts mental health. Renters may be more likely to experience these issues than owners; hence, they fare worse in terms of their mental health when in HAS than owners do.