IDEAS home Printed from https://ideas.repec.org/a/jre/issued/v26n42004p329-344.html
   My bibliography  Save this article

Why do Households Concentrate Their Wealth in Housing?

Author

Listed:
  • John D. Benjamin

    (Department of Finance and Real Estate, Kogod School of Business, American University, 4400 Massachusetts Avenue, NW Washington, DC 20016)

  • Peter Chinloy

    (Department of Finance and Real Estate, Kogod School of Business, American University, 4400 Massachusetts Avenue, NW Washington, DC 20016)

  • G. Donald Jud

    (Department of Finance, School of Business, University of North Carolina, Greensboro, North Carolina 27412)

Abstract

An apparent paradox in household wealth accumulation in the United States is the relatively small holding of financial assets and the large holding of housing wealth. To explain the high concentration of household wealth in housing, this paper estimates the marginal propensity to consume from housing and from financial assets. A higher marginal propensity to consume from housing rather than from financial assets would lead households to concentrate their wealth in real estate. For aggregate U.S. quarterly data from 1952:1 to 2002:2, the marginal propensity to consume from housing is higher than that from financial wealth. These conditions provide a rationale for the concentration of household assets in housing.

Suggested Citation

  • John D. Benjamin & Peter Chinloy & G. Donald Jud, 2004. "Why do Households Concentrate Their Wealth in Housing?," Journal of Real Estate Research, American Real Estate Society, vol. 26(4), pages 329-344.
  • Handle: RePEc:jre:issued:v:26:n:4:2004:p:329-344
    as

    Download full text from publisher

    File URL: http://pages.jh.edu/jrer/papers/pdf/past/vol26n04/01.329_344.pdf
    File Function: Full text
    Download Restriction: no
    ---><---

    More about this item

    JEL classification:

    • L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:jre:issued:v:26:n:4:2004:p:329-344. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: JRER Graduate Assistant/Webmaster (email available below). General contact details of provider: http://www.aresnet.org/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.