EconPapers    
Economics at your fingertips  
 

Household mortgage refinancing decisions are neighbor influenced, especially along racial lines

W. Ben McCartney and Avni M. Shah

Journal of Urban Economics, 2022, vol. 128, issue C

Abstract: Neighborhood peer effects have been shown to affect households publicly observable decisions, but how they affect private decisions, like mortgage refinancing, remains unclear. Using precisely geolocated data and a nearest-neighbor research design, we find that households are 7% more likely to refinance if a neighbor within 50 m has recently refinanced. Consistent with a word-of-mouth mechanism, social influence effects are stronger when neighbors live especially nearby, weaker when owners are non-occupants, and stronger when neighbors and owners are of the same race. Our results suggest an important role for neighborhood peer effects in explaining regional variation in refinancing activity.

Keywords: Household finance; Refinancing; Peer effects; Neighborhoods (search for similar items in EconPapers)
JEL-codes: D12 D14 D71 H31 R23 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0094119021000917
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:juecon:v:128:y:2022:i:c:s0094119021000917

DOI: 10.1016/j.jue.2021.103409

Access Statistics for this article

Journal of Urban Economics is currently edited by S.S. Rosenthal and W.C. Strange

More articles in Journal of Urban Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().

 
Page updated 2022-07-02
Handle: RePEc:eee:juecon:v:128:y:2022:i:c:s0094119021000917