Financial Satisfaction and Homeownership

Derek T. Tharp (), Martin Seay (), Cherie Stueve () and Somer Anderson ()
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Derek T. Tharp: University of Southern Maine
Martin Seay: Kansas State University
Cherie Stueve: Kansas State University
Somer Anderson: Maryville University

Journal of Family and Economic Issues, 2020, vol. 41, issue 2, No 6, 255-280

Abstract: Abstract This study investigates the relationship between homeownership and financial satisfaction. Using samples of non-retired individuals ages 25–64, this study examines three questions. First, what is the relationship between homeownership and financial satisfaction? Second, among homeowners, what is the relationship between holding a mortgage and financial satisfaction? Third, among mortgage holders, what is the relationship between having missed mortgage payments and financial satisfaction? Through the use of ordinary least squares regressions on non-pooled, cross-sectional data from the 2009, 2012, and 2015 waves of the U.S. State-by-State National Financial Capability Study, this study finds that homeownership is positively associated with financial satisfaction; among homeowners, having a mortgage is negatively associated with financial satisfaction; and among mortgage holders, having missed a mortgage payment is positively associated with financial satisfaction. The positive association between having missed a mortgage payment and financial satisfaction is counterintuitive and warrants further investigation. Potential factors contributing to this unexpected relationship between having missed a mortgage payment and financial satisfaction—including measurement issues and endogeneity—are discussed. Policy makers may wish to consider the nuanced ways in which homeownership (positive) and having a mortgage (negative) are associated with financial satisfaction when developing policies which promote homeownership.

Keywords: Financial satisfaction; Homeownership; Mortgage; Subjective well-being (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (8)

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DOI: 10.1007/s10834-019-09652-0

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