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Do high levels of home-ownership create unemployment? Introducing the missing link between housing tenure and unemployment

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  • Ida Borg
  • Maria Brandén

Abstract

A large number of studies have demonstrated that the proportion of home-owners in a region tend to be positively associated with the unemployment levels in that region. In this paper, we introduce a missing piece of explaining this commonly found pattern. By analysing individual-level population register data on Sweden, we jointly examine the effects of micro- and macro-level home-ownership on individuals’ unemployment. The findings indicate that even though home-owners have a lower probability of being unemployed, there is a penalty for both renters and home-owners on unemployment in regions with high home-ownership rates. Differences in mobility patterns cannot explain this pattern. However, when labour market size is considered, the higher probability of unemployment in high home-owning regions is drastically reduced. This suggests that high home-ownership regions tend to coincide with small labour markets, affecting the job matching process negatively.

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  • Ida Borg & Maria Brandén, 2018. "Do high levels of home-ownership create unemployment? Introducing the missing link between housing tenure and unemployment," Housing Studies, Taylor & Francis Journals, vol. 33(4), pages 501-524, May.
    • Handle: RePEc:taf:chosxx:v:33:y:2018:i:4:p:501-524
    DOI: 10.1080/02673037.2017.1358808
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    Cited by:

    1. William Cochrane & Jacques Poot, 2020. "Did the post-1986 decline in the homeownership rate benefit the New Zealand labour market? A spatial-econometric exploration," Asia-Pacific Journal of Regional Science, Springer, vol. 4(1), pages 261-284, February.

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