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Job loss risk, expected mobility, and home ownership

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  • Botsch, Matthew J.
  • Morris, Stephen D.

Abstract

Geographic mobility is a key factor affecting the home purchase decision, and a common reason for moving is to find work. Yet, little is known regarding how job loss risk affects home ownership via the mobility channel. Measuring this effect is difficult because job loss risk usually coincides with income and credit shocks. We isolate the mobility channel by studying economics professors on the tenure track. Our analysis uses public records to provide the first quantitative estimates of this effect, and we validate our results with a follow-up survey. A one percentage point increase in expected mobility, identified via variation in tenure risk, reduces the probability of home ownership by up to 1.8 percentage points.

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  • Botsch, Matthew J. & Morris, Stephen D., 2021. "Job loss risk, expected mobility, and home ownership," Journal of Housing Economics, Elsevier, vol. 53(C).
    • Handle: RePEc:eee:jhouse:v:53:y:2021:i:c:s1051137720300693
    DOI: 10.1016/j.jhe.2020.101733
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    1. Mangum, Kyle & Molloy, Raven, 2021. "Migration and Housing special issue: Introduction from Editors Kyle Mangum and Raven Molloy," Journal of Housing Economics, Elsevier, vol. 53(C).

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    More about this item

    Keywords

    Home ownership; Rent/buy decision; Geographic mobility; Labor market search;
    All these keywords.

    JEL classification:

    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand
    • R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets

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