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Does Homeownership Prolong the Duration of Unemployment?

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  • Ahmet Ali Taşkın
  • Fırat Yaman

Abstract

We examine the effects of homeownership on individuals' unemployment durations. An unemployment spell can terminate with a job or with nonparticipation. The endogeneity of homeownership is addressed by estimating a full maximum likelihood function jointly modeling the competing hazards and the probability of being a homeowner. Unobserved factors contributing to the probability of being a homeowner are allowed to be correlated with unobservable heterogeneity in the hazard rates. Not controlling for ownership selection, there is neither a significant difference in the job‐finding hazard nor in the nonparticipation hazard of unemployed owners and renters. If we jointly model the ownership selection, we find that unemployed homeowners are more likely to find a job than renters.

Suggested Citation

  • Ahmet Ali Taşkın & Fırat Yaman, 2019. "Does Homeownership Prolong the Duration of Unemployment?," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 47(3), pages 845-883, September.
    • Handle: RePEc:bla:reesec:v:47:y:2019:i:3:p:845-883
    DOI: 10.1111/1540-6229.12173
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    Cited by:

    1. Welters, Riccardo & Gerards, Ruud & Mellor, Kyran, 2024. "Homeownership, the unemployed and financial hardship," Journal of Housing Economics, Elsevier, vol. 64(C).
    2. Johannes Strobel & Binh Nguyen Thanh & Gabriel Lee, 2020. "Effects of Macroeconomic Uncertainty and Labor Demand Shocks on the Housing Market," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 48(2), pages 345-372, June.
    3. Vives Coscojuela, Cecilia, 2018. "Housing Tenure, Geographical Mobility and the Labour Market: the Role of the Employment Exit Rate," IKERLANAK 30207, Universidad del País Vasco - Departamento de Fundamentos del Análisis Económico I.
    4. Ning Jia & Raven Molloy & Christopher Smith & Abigail Wozniak, 2023. "The Economics of Internal Migration: Advances and Policy Questions," Journal of Economic Literature, American Economic Association, vol. 61(1), pages 144-180, March.
    5. 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).
    6. Daniel R. Ringo, 2021. "Home ownership as a labor market friction," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 49(S1), pages 111-133, March.
    7. Botsch, Matthew J. & Morris, Stephen D., 2021. "Job loss risk, expected mobility, and home ownership," Journal of Housing Economics, Elsevier, vol. 53(C).

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