The Government has asked the Commission to evaluate the factors influencing the affordability of housing in New Zealand (both rental and owner-occupied) and to examine potential opportunities to increase affordability. The context of this inquiry is the recognition that stability of the home environment is important for social cohesion and family stability. There is a concern that real (inflation-adjusted) house prices in New Zealand are markedly higher than they were a decade ago and that this has been associated with general declines in housing affordability and home ownership rates. These declines have contributed to increased demand for rental accommodation and additional pressure on the social housing sector.