Measuring housing affordability in São Paulo metropolitan region: Incorporating location

This paper develops a novel measure of affordability for the São Paulo metropolitan region that combines housing costs and transportation costs, including opportunity cost associated with commuting time. The results for the 2007-2013 period indicate that the number of households spending > 30% of their income on housing or 45% or more on housing and transportation costs combined has been increasing rapidly. This measure of affordability that includes transportation costs provides a broader measure of housing needs to guide housing policy in addressing housing conditions that have negative effects on individual and social welfare.