Identifying the Benefits from Homeownership: A Swedish Experiment

Paolo Sodini, Stijn Van Nieuwerburgh, Roine Vestman and Ulf von Lilienfeld-Toal

American Economic Review, 2023, vol. 113, issue 12, 3173-3212

Abstract: Homeownership is widely stimulated by policy, yet its economic effects are poorly understood. We exploit quasi-random variation in homeownership generated by privatization decisions of municipally owned buildings and use granular data on demographics, income, housing, financial wealth, and debt that allow us to construct high-quality measures of spending. Homeownership causes wealth accumulation via house price appreciation, increases consumption, and improves consumption smoothing across time and states of the world. It increases mobility for young households, who move up the property ladder, and amplifies wealth accumulation for older households, who take more risk in their financial portfolio.

JEL-codes: D15 E21 G51 R21 R23 R31 R38 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (8)

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Related works:
Working Paper: Identifying the Benefits from Home Ownership: A Swedish Experiment (2016)
Working Paper: Identifying the Benefits from Homeownership: A Swedish Experiment (2016)
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DOI: 10.1257/aer.20171449

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