Highlights from the full article included in the latest volume of the Journal of the Center for Real Estate Studies.
Research has consistently shown the importance of the housing sector on the economy and the long-term social and financial benefits to individual homeowners. However, in recent years many have questioned the role of homeownership due to the housing downturn and foreclosure crisis. Thus, a related question is: do the social benefits of homeownership from the past still apply? With respect to the new conditions of the real estate market, the current report provides an updated review of the literature of the social benefits of homeownership. Furthermore, this paper examines not only the ownership of homes, but also the impact of stable housing (as opposed to transitory housing and homelessness) on social outcomes, looking specifically at some outcome measures such as:
Consistent findings show that homeownership does make a significant positive impact on educational achievement. Less clear, however, is whether homeownership in itself, stable housing or favorable neighborhood characteristics are the main underlying factors contributing to better educational outcomes.
More recently, researchers found that the act of saving has some association with child outcomes and specifically the degree to which children of homeowners are less likely to drop out of school.
The extent of community involvement and the benefits that accrue to society are hard to measure, but several researchers have found that homeowners tend to be more involved in their communities than renters.
After the sharp decline of home prices, recent studies reevaluated the social role of homeownership and found that residential stability increases the likelihood of electoral participation but is unrelated to participation in membership groups. Interestingly, even after controlling for residential stability, homeowners remain more likely to participate in local elections, civic groups and neighborhood compared to renters.
Early studies of homeownership and health outcomes found that homeowners and children of homeowners are generally happier and healthier than non-owners, even after controlling for factors such as income and education levels that are also associated with positive health outcomes and positively correlated with homeownership.
More recent studies have found that the wealth building effect of homeownership and the sense of control it provides to homeowners in a stable housing market affect homeowners’ mental and physical health in a positive way. However, the literature is mixed in times of housing market instability. While some studies showed that homeowners fared better than renters during the recent housing crisis, other studies suggest that areas of high housing distress also had high rates of mental health and stress-related diagnoses. More research is needed on the relationship of health outcomes and homeownership.
Research on crime and home ownership shows that a lower crime rate among homeowners and people living in a stable housing environment are consistent with theories on social disorganizations. A stable neighborhood, independent of ownership structure, is also likely to reduce crime. It is easier to recognize a perpetrator of crime in a stable neighborhood with extensive social ties.
However, with respect to the housing crisis and the increased foreclosure rates, several studies readdressed the relationship between homeownership and crime examining the effects of foreclosures on neighborhood crime. Most of those studies found some evidence that additional foreclosure leads to an increase of burglary and violent rates.