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Housing Inequality

Author

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  • David Albouy
  • Mike Zabek

Abstract

Inequality in U.S. housing prices and rents both declined in the mid-20th century, even as home-ownership rates rose. Subsequently, housing-price inequality has risen to pre-War levels, while rent inequality has risen less. Combining both measures, we see inequality in housing consumption equivalents mirroring patterns in income across both space and time, according to an income elasticity of housing demand just below one. These patterns occur mainly within cities, and are not explained by observed changes in dwelling characteristics or locations. Instead, recent increases in housing inequality are driven most by changes in the relative value of locations, seen especially through land.

Suggested Citation

  • David Albouy & Mike Zabek, 2016. "Housing Inequality," NBER Working Papers 21916, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:21916
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    Cited by:

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    2. Greg Howard & Carl Liebersohn, 2019. "What Explains U.S. House Prices? Regional Income Divergence," 2019 Meeting Papers 1054, Society for Economic Dynamics.
    3. Amior, Michael, 2020. "Immigration, local crowd-out and undercoverage bias," LSE Research Online Documents on Economics 108490, London School of Economics and Political Science, LSE Library.
    4. Amior, Michael, 2018. "The contribution of foreign migration to local labor market adjustment," LSE Research Online Documents on Economics 91705, London School of Economics and Political Science, LSE Library.
    5. Krolikowski, Pawel & Zabek, Mike & Coate, Patrick, 2020. "Parental proximity and earnings after job displacements," Labour Economics, Elsevier, vol. 65(C).
    6. Divya Singh, 2020. "Do Property Tax Incentives for New Construction Spur Gentrification? Evidence from New York City," 2020 Papers psi856, Job Market Papers.
    7. Prottoy A. Akbar & Sijie Li & Allison Shertzer & Randall P. Walsh, 2019. "Racial Segregation in Housing Markets and the Erosion of Black Wealth," NBER Working Papers 25805, National Bureau of Economic Research, Inc.
    8. Clement Bellet, 2017. "The Paradox of the Joneses: Superstar Houses and Mortgage Frenzy in Suburban America," CEP Discussion Papers dp1462, Centre for Economic Performance, LSE.
    9. C. Y. Cyrus Chu & Jou-Chun Lin & Wen-Jen Tsay, 2020. "Males’ housing wealth and their marriage market advantage," Journal of Population Economics, Springer;European Society for Population Economics, vol. 33(3), pages 1005-1023, July.
    10. Gray, Rowena, 2020. "Inequality in nineteenth century Manhattan: Evidence from the housing market," QUCEH Working Paper Series 2020-02, Queen's University Belfast, Queen's University Centre for Economic History.
    11. Bellet, Clement, 2017. "The paradox of the Joneses: superstar houses andmortgage frenzy in suburban America," LSE Research Online Documents on Economics 69044, London School of Economics and Political Science, LSE Library.

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    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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