Aging and Housing Returns

Natee Amornsiripanitch, Philip E. Strahan and Song Zhang ()
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Natee Amornsiripanitch: https://www.philadelphiafed.org/our-people/natee-amornsiripanitch
Song Zhang: https://lerner.udel.edu/faculty-staff-directory/song-zhang-2/

No 25-35, Working Papers from Federal Reserve Bank of Philadelphia

Abstract: Older home sellers receive lower returns than younger home sellers. Homes sold by older people have fewer major renovations but higher rates of poor upkeep. Older sellers are also more likely to sell off-MLS (“pocket listings”) and to sell to investors, leading to lower prices. These patterns suggest that older sellers may be disproportionately disadvantaged by agents’ incentive to maximize fees through generating high sales volume instead of maximizing sale prices. Age-related cognitive decline makes the elderly more vulnerable. For causal evidence, we show that reforms making private listings more transparent reduced both the prevalence of pocket listings and the magnitude of the age gap in returns.

Keywords: Aging; housing returns; incentive misalignment (search for similar items in EconPapers)
JEL-codes: G5 J1 (search for similar items in EconPapers)
Pages: 59
Date: 2025-11-04
New Economics Papers: this item is included in nep-age and nep-lab
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DOI: 10.21799/frbp.wp.2025.35

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