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Alex Fernandez

ESR12

Alex Fernandez is an early career researcher (PhD candidate) in comparative housing policy at the department of Management of the Built Environment, TU Delft. He is interested in a range of economic and social issues related to affordable housing provision, low-emissions housing and environmental transitions. He holds a Double Bachelor in History and Political Science from Universidad Rey Juan Carlos (URJC), an MSc in City Design and Social Sciences from the London School of Economics (LSE), and is currently studying a part-time MSc in Economics at Birkbeck, University of London.

He has contributed to projects led by LSE Cities, ”Socio-Economic Value at the Elephant and Castle” and LSE London, “Barriers to acceptance of housing offers by families in temporary accommodation”, and on Innovation in Urban Policy, as well as interned at the Spanish Ministries of Public Works and Foreign Affairs. He has also worked as an analyst at various start-ups and at Peabody, one of London’s largest providers of social housing, where he researched the impact of housing and social care policies on social housing residents.

Research topic

Updated sumaries

May, 11, 2022

December, 09, 2021

European countries are implementing a wide array of policies to accelerate the transition toward a low-emissions’ built environment. Drastically improving the energy efficiency of the housing stock through subsidies and regulations is often among the key proposals, while impacts on affordability are unsure. This dissertation analyses energy transition policies within the context of increasingly unequal housing markets undergoing chronic affordability issues. The focus is on providing a critical analysis of housing retrofit policies that accounts for distributional effects across households. To tackle this broad topic, the main overarching question “How will the strive for sustainability affect the affordability of housing costs?” is subdivided into four research sections aiming to highlight the impacts of housing retrofit across different tenures and European countries. The first stream builds on the sub-question: “How will the energy transition affect homeowners’ costs under different policy scenarios?” This section uses the Netherlands as a quantitative case study and is intended as micro groundwork to be incorporated in an economic model of the housing market in stream two. This second stream focuses on market dynamics by answering the question “How will improving energy efficiency alter housing supply, demand and ultimately affordability?” This part builds on neoclassical housing models and draws from current research on heterogeneous agents models (HAM) to account for inequalities. The third research stream focuses on comparing housing markets under different economic and social pressures. The main question here is “How do distributional policy impacts change across housing markets?” This cross-country comparison will employ the model defined in stream 2 to account for national housing market particularities, such as tenure composition and price growth. Finally, the fourth stream focuses on funding models for the energy transition in social housing. It develops the question: “What are the roles of capital markets, public authorities and residents in funding the energy transition in social housing? Considering the trade-offs between green bonds, grants and rent increases” This last stream will be mainly qualitative and apply a political economy framework to a series of interviews with social housing and finance professionals. This project draws from the disciplines of neoclassical economics and political economy bringing these two bodies of knowledge together in two ways. First, it implements both quantitative methods —through formal economic modelling— and critical approaches to the role of finance in housing transitions. Second, this proposal intends to quantify the distributional impact of retrofit and sustainability policies on households and contextualise it within housing economics and affordability. By bringing these perspectives together, this project aims to formulate policy-relevant insights on housing inequalities and contribute to the design of socially sustainable transition policies.

Comparative Analysis of Affordable and Sustainable Housing Policies in Europe (ESR12)

This project’s main research goal is to identify and compare policies for the affordable retrofit of Europe’s built environment. The analytical framework draws from various disciplines including economics, public policy, and complexity science. These disciplines provide the foundations to four research streams:

  1. Analysing of user costs and cash-flows implications for various housing retrofit policies within the Dutch national context. By comparing the economic implications of different policies across households and housing typologies, this line of inquiry seeks to identify the financial impacts over renters, owners, and landlords with varying income levels.
  2. Constructing an Agent-Based Model of the housing market. This model aims to capture the second and third-order effects that modifications to the housing stock can have over house prices and ultimately affordability. Here the focus will be on the potential distributional effects of housing retrofit.
  3. Adapting the preceding model to account for particularities across countries and urban areas. This model will include the economic and social contexts that condition policy outcomes across European housing systems.
  4. Exploring institutional and policy design across different public and private organisations. This mainly qualitative stream will critically analyse institutional arrangements that favour the adoption of affordable and sustainable housing policies. The point of contact with experts will be the RE-DWELL network, secondments, and case studies.

These four research streams are empirically and methodologically led, however, ESR12 also aspires to contribute to the theoretical underpinning of public policy analysis, housing economics, and critical social sciences. These disciplines, while dealing with the same research topics, have evolved through divergent perspectives; ESR12 seeks to strengthen the links between them. By bringing these perspectives together, this project intends to formulate realistic policy recommendations for the design of a fair transition to a low-emissions' built environment.

Blog

Recent activity

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A fruitful time at Housing Europe

Posted on 08-11-2022

ESG risks being one of the most (over)used acronyms of this decade. Hailed as “the” solution to climate change or dismissed as greenwashing, it is also becoming important to review its relevance for social housing. This has precisely been the focus of my research at Housing Europe, framed within the RE-DWELL project, funded by the European Commission. Last week, I was invited to the 83rd session of the UNECE Committee on Urban Development to discuss the role of green finance in enabling the development and renovation of social housing. You can follow some of the points I raised at this event on a blog I wrote for Housing Europe in the link below: https://www.housingeurope.eu/blog-1733/the-role-of-green-finance-in-enabling-the-development-and-renovation-of-social-housing

Secondments

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It's Pride Month! Let's talk about queering housing economics

Posted on 05-06-2022

It’s pride month and we queers get to celebrate our identity. That is, unless we are in one of the 71 countries that still criminalise homosexuality. In fact, in 11 of them not being straight can get you executed. But hey, you don’t need to go to Uganda to get killed for being gay, just going out with your friends can end up with you getting beaten to death as it happened to a 23-year-old last year in my home region. [1]   At least our cheesy teenager romcoms are better, just like Hearstopper on Netflix has proven to the whole world once again. That being said, I’m not here to (just) shame all the straight readers and celebrate queer culture alone. I have something to say about housing economics. Because economics is queer. This is not only because Keynes, the father of macroeconomics whose birthday is today, was a queer himself (and a Gemini) but because economic inequalities affect sexual minorities harder.  But enough about Keynes's hook-up list which proves that gay sex was already ubiquitous even before Grindr. [2]   I want to draw your attention to some facts. The charity AKT reports that as many as 24% of young (aged 16 to 25) homeless people in the UK are LGBT+. This is a more than worrisome figure given queers are less than 10% of the population. Abuse, poverty and exclusion are still the daily realities of many a queer youth. Please have a look at their latest report here. [3] [4] [5]   However, the discrimination of queer people is not only tangible in homelessness but permeates housing provision tout court. According to research by Freddie Mac, the government agency tasked with expanding the secondary market for mortgages in the US, LGBT ownership lags behind the general population. 49% of LGBT community members are likely to own a home, considerably lower than the current national rate (64.3).  Gays and lesbians are the most likely to own (52%) “while LGBT African-Americans (30 per cent) and LGBT Millennials (23 per cent) were the least likely to be homeowners.” [6]   Homeownership has come to occupy a central role in wealth building and welfare provision, particularly for the middle classes and those well-off. This is a direct result of a set of housing policies, including mortgage interest deduction and lack of capital gain tax, often enacted by governments across the political spectrum. Problematising the distributional impact of these policies on queer households is paramount to the reformulation of housing provision.   You can now go click on Keyne’s hook-up list, which together with his latest biography by Zachary D. Carter is not to be missed.    [1]https://www.theguardian.com/world/2021/jul/06/protests-spain-gay-man-samuel-luiz-beaten-death-galicia [2]https://www.theatlantic.com/daily-dish/archive/2008/01/keyness-jew-boy-quickie/220620/ [3]https://www.akt.org.uk/report [4]https://www.insidehousing.co.uk/insight/insight/lgbtq-homelessness-the-data-hole-that-undermines-services-74552 [5]https://www.insidehousing.co.uk/comment/comment/lgbtq-homeless-people-face-increased-risk-we-are-committed-to-helping-them-72562 [6]https://www.freddiemac.com/research/consumer-research/20181001-lgbt-homeownership [7]https://www.penguinrandomhouse.com/books/563378/the-price-of-peace-by-zachary-d-carter/

Reflections

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Holism?

Posted on 08-12-2021

Holistic has definitely become one of the current slogans in policy, just like “it’s the economy, stupid” was during Clinton’s campaign in 1992. This new mantra of housing studies seems to be about the integration of a certain mix of socio-economic-environmental aspects. In this regard, holism may deliver a satisfactory umbrella term. However, does it really work as a research strategy? Is really the whole larger than its parts? Can we apprehend a whole without understanding its constituents?   Economists love to start academic papers by saying that housing, homeownership, in particular, is both a financial asset (a resource) and a consumption good (directly used by households). Thankfully, humanity has gone beyond neoclassical economics, and that includes economists. In a way, the totality of housing as a fact escapes any discipline since it is always nested in the next. As a house with its built components is incorporated into a market to become an asset, it also acquires meaning by providing ontological security to its inhabitants (Madden & Marcuse, 2016).   In fact, housing systems can be studied from myriad perspectives. As the documentary “Anamones” shows, steel bars protruding from a home can be the longing promise of secure housing and stronger family bonds with your offspring. Similarly, the new season of Netflix’s show Selling Sunset glosses over the social status that comes with real estate, while emphasising the psychological struggle of modern urban life in L.A. Indeed, housing is as much about feelings of safety and community as it is about wall cavity insulation and faux-brick veneers.   As researchers, we do not only perceive reality through various neutral inputs, we actively participate in the construction of our respective objects of study. Naturally, we pay more attention to those elements that are more relevant for our research questions – what some call observer dependency. Opposite to holism, we encounter reductionism, the epistemological position that the whole is nothing but a set of interacting fundamental parts. This is the position taken for example by Epstein and Axtell (1996), together with a series of complexity experts researching how societies work following sets of basic rules. In this vein, awareness of the limitations in our approaches enhances research outputs, does not hinder them. While keeping an eye on the total, let’s not forget that systems are usually made of understandable parts.   Epstein, J. M., & Axtell, R. (1996). Growing Artificial Societies. Social Science from the bottom-up. Brookings Institution. Madden, D., & Marcuse, P. (2016). In Defense of Housing: The Politics of Crisis. Verso.

Reflections, Summer schools

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Croatian Housing Subsidies

Posted on 04-12-2021

In 2017, Croatia implemented a new housing subsidy programme covering up to 50% of mortgage payments in the first four years, with a total amount not higher than 100.000 EUR. Recent economic evidence points to this policy having increased housing prices while being ineffective at raising the homeownership rate (Kunovac & Zilic, 2021).   Throughout this winter, during a secondment at CERANEO, I have undertaken a series of interviews with relevant stakeholders: civil servants, private financiers and politicians as well as descriptive data analysis from European and national sources to contextualise this subsidy within contemporary changes in the Croatian housing landscape and, more broadly, social policy.   In the short paper I’m currently writing with Croatian colleagues, I’ll mobilise evidence from economics, sociology and political science to address the role of housing in the reformulation of social policy in the Croatian transition.   Kunovac, D., & Zilic, I. (2021). The effect of housing loan subsidies on affordability: Evidence from Croatia. Journal of Housing Economics. https://doi.org/10.1016/j.jhe.2021.101808

Secondments

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Case studies

Contributions to the case study library

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Vocabulary

Contributions to the vocabulary

Housing Policy

Housing Retrofit

Area: Policy and financing

Housing policies are usually understood in a narrow manner as social policies targeting housing prices through housing allowances, tax deduction or social housing allocation. This definition takes a different approach and draws from a larger body of economic literature to identify the wider array of policies that impact housing markets. Broadly speaking, housing markets are influenced through fiscal, macroeconomic, prudential and structural policies (Hilbers et al., 2008). This wide range of public policies have clear impacts on housing demand and supply and also usually create synergies between each other. Fiscal policies have a stronger impact on income and costs through taxation and subsidies. One of the main fiscal policies with regard to housing is the mortgage interest deduction which reduces user costs and can produce increases in property prices (Poterba, 1984). Macroeconomic policy regulates the money supply through interest rates. Housing has usually been perceived as a conveyor belt for macroeconomic policy as the expansion of the money supply through low interest rates or quantitative easing has the potential to increase demand during recessions counteracting the procyclical behaviour of financial markets (Muellbauer, 1992). Prudential policies determine the level of risk associated with lending through Loan-to-Value (LTV) and Debt-to-Income (DTI) ratios. The Great Financial Crisis is usually seen as the failure of prudential policy that resulted in the tightening of loans  (Whitehead & Williams, 2017) and  drew renewed attention to housing policy from central banks, policymakers, and economists (Piazzesi et al., 2016). Structural policies regulate housing supply, this includes planning regulations and environmental standards. For example, research from the US has shown that zoning laws can have a relevant impact on housing affordability by constraining supply (Glaeser & Gyourko, 2002). While most research is conducted selectively on each of these policy interventions, there are relevant synergies between policy domains that can be identified. These policies usually work in conjunction with each other: lax prudential policies and favourable home ownership taxation together with low interest rates and tight planning controls can lead to higher property prices. Conversely, constrained lending, brick-and-mortar subsidies and higher interests rates are known to mitigate rising house prices.

Created on 01-07-2022

Author: A.Fernandez (ESR12)

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Area: Design, planning and building

Environmental Retrofit Buildings are responsible for approximately 40% of energy consumption and 36% of carbon emissions in the EU (European Commission, 2021). Environmental retrofit, green retrofit or low carbon retrofits of existing homes ais to upgrade housing infrastructure, increase energy efficiency, reduce carbon emissions, tackle fuel poverty, and improve comfort, convenience and aesthetics (Karvonen, 2013). It is widely acknowledged that environmental retrofit should result in a reduction of carbon emissions by at least 60% in order to stabilise atmospheric carbon concentration and mitigate climate change (Fawcett, 2014; Johnston et al., 2005). Worldwide retrofit schemes such as RetrofitWorks, EnerPHit and the EU’s Renovation Wave, use varying metrics to define low carbon retrofit, but their universally adopted focus has been on end-point performance targets (Fawcett, 2014). This fabric-first approach to retrofit prioritises improvements to the building fabric through: increased thermal insulation and airtightness; improving the efficiency of systems such as heating, lighting and electrical appliances; and the installation of renewables such as photovoltaics (Institute for Sustainability & UCL Energy Institute, 2012). The whole-house systems approach to retrofit further considers the interaction between the occupant, the building site, climate, and other elements or components of a building (Institute for Sustainability & UCL Energy Institute, 2012). In this way, the building becomes an energy system with interdependent parts that strongly affect one another, and energy performance is considered a result of the whole system activity. Economic Retrofit From an economic perspective, retrofit costs are one-off expenses that negatively impact homeowners and landlords, but reduce energy costs for occupants over the long run. Investment in housing retrofit, ultimately a form of asset enhancing, produces an energy premium attached to the property. In the case of the rental market, retrofit expenses create a split incentive whereby the landlord incurs the costs but the energy savings are enjoyed by the tenant (Fuerst et al., 2020). The existence of energy premiums has been widely researched across various housing markets following Rosen’s hedonic pricing model. In the UK, the findings of Fuerst et al. (2015) showed the positive effect of energy efficiency over price among home-buyers, with a price increase of about 5% for dwellings rated A/B compared to those rated D. Cerin et al. (2014) offered similar results for Sweden. In the Netherlands, Brounen and Kok (2011), also identified a 3.7% premium for dwellings with A, B or C ratings using a similar technique. Property premiums offer landlords and owners the possibility to capitalise on their  retrofit investment through rent increases or the sale of the property. While property premiums are a way to reconcile          split incentives between landlord and renter, value increases pose questions about long-term affordability of retrofitted units, particularly, as real an expected energy savings post-retrofit have been challenging to reconcile (van den Brom et al., 2019). Social Retrofit A socio-technical approach to retrofit elaborates on the importance of the occupant. To meet the current needs of inhabitants, retrofit must be socially contextualized and comprehended as a result of cultural practices, collective evolution of know-how, regulations, institutionalized procedures, social norms, technologies and products (Bartiaux et al., 2014). This perspective argues that housing is not a technical construction that can be improved in an economically profitable manner without acknowledging that it’s an entity intertwined in people’s lives, in which social and personal meaning are embedded. Consequently, energy efficiency and carbon reduction cannot be seen as a merely technical issue. We should understand and consider the relationship that people have developed in their dwellings, through their everyday routines and habits and their long-term domestic activities (Tjørring & Gausset, 2018). Retrofit strategies and initiatives tend to adhere to a ‘rational choice’ consultation model that encourages individuals to reduce their energy consumption by focusing on the economic savings and environmental benefits through incentive programs, voluntary action and market mechanisms (Karvonen, 2013). This is often criticized as an insufficient and individualist approach, which fails to achieve more widespread systemic changes needed to address the environmental and social challenges of our times (Maller et al., 2012). However, it is important to acknowledge the housing stock as a cultural asset that is embedded in the fabric of everyday lifestyles, communities, and livelihoods (Ravetz, 2008). The rational choice perspective does not consider the different ways that occupants inhabit their homes, how they perceive their consumption, in what ways they interact with the built environment, for what reasons they want to retrofit their houses and which ways make more sense for them, concerning the local context. A community-based approach to domestic retrofit emphasizes the importance of a recursive learning process among experts and occupants to facilitate the co-evolution of the built environment and the communities (Karvonen, 2013). Involving the occupants in the retrofit process and understanding them as “carriers” of social norms, of established routines and know-how, new forms of intervention  can emerge that are experimental, flexible and customized to particular locales (Bartiaux et al., 2014). There is an understanding that reconfiguring socio-technical systems on a broad scale will require the participation of occupants to foment empowerment, ownership, and the collective control of the domestic retrofit (Moloney et al., 2010).

Created on 16-02-2022

Author: S.Furman (ESR2), Z.Tzika (ESR10), A.Fernandez (ESR12)

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Publications

Fernández, A., Bezovan, G., & Pandzic, J. (2022, August-September). Analysing the role of housing subsidies within the Croatian economic growth strategy: a political economy approach to SSK [Conference paper].  European Network for Housing Research (ENHR) Conference 2022. Barcelona, Spain.

Posted on 31-08-2022

Conference

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Fernández, A., Haffner, M., & Elsinga, M. (2022, August-September). Understanding the impact of energy efficiency on the housing costs to income ratio: an Instrumental Variable approach [Conference paper].  European Network for Housing Research (ENHR) Conference 2022. Barcelona, Spain.

Posted on 31-08-2022

Conference

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Fernández, A., Haffner, M., & Elsinga, M. (2022, June). Analysing the financial impact of housing retrofit policies on Dutch homeowners: Comparing user cost and cash flow approaches [Conference poster]. 3rd International Conference on Energy Research & Social Science, Manchester, UK.

Posted on 22-06-2022

Conference

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