Homeownership Not All It's Cracked Up to Be?

by Dollars and Sense

An economist at the Wharton School just released a study looking at the ancillary individual and community benefits that supposedly come with homeownership: greater happiness, more civic participation, etc. etc. Her research basically finds no support for these benefits. Here’s a brief excerpt:

An interesting portrait of homeowners emerges from my analysis. While homeowners report higher life satisfaction, more joy from both home and neighborhood and better moods on an unadjusted basis, these promising differences become insignificant and much smaller in magnitude once I control for a basic set of confounding factors: household income, housing value and health status. Overall, I find little evidence that homeowners are happier by any of the following definitions: life satisfaction, overall mood, overall feeling, general moment-to-moment emotions (i.e., affect) and affect at home. The average homeowner, however, consistently derives more pain (but no more joy) from their house and home. Although they are also more likely to be 12 pounds heavier, report a lower health status and less joy from health, controlling for the less favorable health status does not change the results. My findings are robust to controlling for financial insecurity. Therefore, unadjusted differences in homeowners’ well-being might have played an important role in establishing the popular beliefs about the American Dream.

To help understand these surprising results, I investigate the homeowners’ time use pattern, family and social lives. The average homeowner tends to spend less time on active leisure or with friends, experience more negative affect during time spent with friends, derive less joy from love and relationships and is also less likely to consider herself to enjoy being with people. My results support neither the perception of gregarious homeowners nor that of housework-burdened homeowners. In this paper, homeowners are also shown not to be significantly different in terms of civic participation or social connectedness.

From Grace W. Bucchianeri, “The American Dream or The American Delusion? The Private and External Benefits of Homeownership.”

Labels: Grace W. Bucchianeri, homeownership

 

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10/20/2009 12:18:00 PM