Mortgage Borrowing and Chronic Disease Outcomes in Older Age: Evidence From Biomarker Data in the Health and Retirement Study

Alec Rhodes, Stephanie Moulton, Cäzilia Loibl, Donald Haurin and Joshua Joseph

The Journals of Gerontology: Series B, 2024, vol. 79, issue 7, 1849-1855

Abstract: ObjectivesThe medical diagnosis of a disease is common in older age and can carry significant financial costs. For many older adults, equity in a home is their primary component of wealth; however, housing wealth is illiquid. We analyze the relationship between the liquidation of housing wealth through mortgage borrowing on older homeowners’ ability to successfully control a disease.MethodsWe use data on homeowners aged 65 and older from the 1998–2016 waves of the Health and Retirement Study (N = 3,457). We use biomarkers and physical health indicators to measure disease control following a medical diagnosis of diabetes, heart condition, high blood pressure, lung disease, or cancer. Random effects linear probability and instrumental variable regressions estimate the associations of housing wealth, new mortgage borrowing, and disease control.ResultsDescriptively, 28% of older homeowners who borrow against home equity are not controlled on their disease, compared to 33% of non-borrowers. Panel data instrumental variable regressions show that each $10,000 borrowed from home equity after diagnosis is associated with a 17-percentage-point reduction in the probability of the disease not being controlled.DiscussionMany older adults are not able or willing to liquidate housing wealth, and the ability to borrow also depends on changes in home values. Thus, housing wealth is not a uniform social determinant of health but is shaped by older adults’ participation in financial markets.

Keywords: Biomarker; Home equity; Mortgage borrowing; Social determinants of health (search for similar items in EconPapers)
Date: 2024
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The Journals of Gerontology: Series B is currently edited by Psychological Sciences - S. Duke Han, PhD and Social Sciences - Jessica A Kelley, PhD, FGSA

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