EconPapers    
Economics at your fingertips  
 

An Alpha in Affordable Housing?

Sven Damen, Matthijs Korevaar and Stijn Van Nieuwerburgh

No 33470, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Residential properties with the lowest rent levels provide the highest investment returns to their owners. Using detailed rent, cost, and price data from the United States, Belgium, and The Netherlands, we show that this phenomenon holds across housing markets and time. If anything, low-rent units hedge business cycle risk. We also find no evidence for differential regulatory risk exposure. We document segmentation of investors, with large corporate landlords shying away from the low-tier segment possibly for reputational reasons. Financial constraints prevent renters from purchasing their property and medium-sized landlords from scaling up, sustaining excess risk-adjusted returns. Low-income tenants ultimately pay the price for this segmentation in the form of a high rent burden.

JEL-codes: G1 G23 G5 R20 R31 (search for similar items in EconPapers)
Date: 2025-02
Note: AP CF ME
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.nber.org/papers/w33470.pdf (application/pdf)
Access to the full text is generally limited to series subscribers, however if the top level domain of the client browser is in a developing country or transition economy free access is provided. More information about subscriptions and free access is available at http://www.nber.org/wwphelp.html. Free access is also available to older working papers.

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:nbr:nberwo:33470

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w33470
The price is Paper copy available by mail.

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by (wpc@nber.org).

 
Page updated 2025-03-19
Handle: RePEc:nbr:nberwo:33470