Does Homeownership Matter? The Long-Term Consequences of Losing a House during the Great Recession

Heidi Artigue, Patrick Bayer, Fernando Ferreira and Stephen Ross

No 33692, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We examine the long-term effects of owning versus renting a home on household wealth and consumption in the United States. Our research design compares homeowners who became seriously delinquent during the Great Recession but differed in whether they received a mortgage modification. While the two groups exhibit nearly identical pre-trends, they diverge by 36 percentage points in home retention. More than half of this disparity persists nearly a decade later, translating into approximately $70,000 in additional housing wealth. Despite substantial differences in homeownership and housing wealth, these gains did not translate into higher consumption, partly because tightening credit constraints limited households’ ability to borrow against accumulated housing equity.

JEL-codes: G51 R21 R28 (search for similar items in EconPapers)
Date: 2025-04
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