Subsidies to Homeownership and Central City Rent

Alexander Daminger

ERES from European Real Estate Society (ERES)

Abstract: This paper analyzes the effects of German homeownership subsidies on the intra-city rent structure. Using a large-scale microdata set on German rent offerings, I first construct novel city rent indexes that include various rings around cities’ CBDs. Using triple differences (DDD) frameworks, I then estimate the introduction of the homeownership subsidies’ effects on rent for cities that received varying subsidy rates. The empirical results indicate that subsidies to homeownership lower central apartment rent premiums in those cities, where they give the “biggest bang for the buck”. Consequently, I find that homeownership subsidies contribute to an increase in housing affordability through the price changes in the rental market: an increase in the subsidies leads potential homeowners to move away from the CBD, resulting in a decrease in the rental demand and lowering the rent.

Keywords: Affordability Dynamics; Homeownership Subsidies; Intra-City Rent Structure; Triple Differences Analysis (search for similar items in EconPapers)
JEL-codes: R3 (search for similar items in EconPapers)
Date: 2025-01-01
References: Add references at CitEc
Citations:

Downloads: (external link)
https://eres.architexturez.net/doc/oai-eres-id-eres2025-96 (text/html)

Related works:
Working Paper: Subsidies to Homeownership and Central City Rent (2021)
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:arz:wpaper:eres2025_96

Access Statistics for this paper

More papers in ERES from European Real Estate Society (ERES) Contact information at EDIRC.
Bibliographic data for series maintained by Architexturez Imprints ().