TY - JOUR
T1 - Borrowing constraints and access to owner-occupied housing
AU - Duca, John V.
AU - Rosenthal, Stuart S.
N1 - Funding Information:
Correspondence to: S.S. Rosenthal, Faculty of Commerce University of British Columbia, Vancouver, BC, V6T 122, Canada. *We thank Larry Jones and two anonymous referees for helpful comments on an earlier draft. We are also grateful to Robert Avery and Arthur Kennickell for giving us access to their cleaned data tape of the 1983 Survey of Consumer Finances. The views expressed here are those of the authors and do not reflect the views of the Federal Reserve Bank of Dallas or the Federal Reserve System. Rosenthal gratefully acknowledges support from the Social Science and Humanities Research Council of Canada and the Real Estate Institute of British Columbia.
PY - 1994/6
Y1 - 1994/6
N2 - Cross-sectional data from the 1983 Survey of Consumer Finances (SCF) enable us to identify two groups of households: those whose housing tenure status is unaffected by borrowing constraints, and those whose housing tenure status may be affected by borrowing constraints. Using these data, a bivariate probit model is estimated to evaluate the joint probability of whether families prefer to live in owner-occupied housing and whether borrowing constraints affect access to owner-occupied housing. Findings indicate that borrowing constraints have a significant negative effect on homeownership rates. Indeed, if borrowing constraints had not been binding in our sample period (the early 1980s), ceteris paribus, owner-occupancy rates in the United States would have risen from 64.5% to nearly 73%. Moreover, borrowing constraints appear to have a disproportionate effect on the ability of younger families and non-white families to own a home, consistent with popular perceptions.
AB - Cross-sectional data from the 1983 Survey of Consumer Finances (SCF) enable us to identify two groups of households: those whose housing tenure status is unaffected by borrowing constraints, and those whose housing tenure status may be affected by borrowing constraints. Using these data, a bivariate probit model is estimated to evaluate the joint probability of whether families prefer to live in owner-occupied housing and whether borrowing constraints affect access to owner-occupied housing. Findings indicate that borrowing constraints have a significant negative effect on homeownership rates. Indeed, if borrowing constraints had not been binding in our sample period (the early 1980s), ceteris paribus, owner-occupancy rates in the United States would have risen from 64.5% to nearly 73%. Moreover, borrowing constraints appear to have a disproportionate effect on the ability of younger families and non-white families to own a home, consistent with popular perceptions.
KW - Credit constraints
KW - Housing
KW - Tenure choice
UR - http://www.scopus.com/inward/record.url?scp=0028597618&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=0028597618&partnerID=8YFLogxK
U2 - 10.1016/0166-0462(93)02041-Z
DO - 10.1016/0166-0462(93)02041-Z
M3 - Article
AN - SCOPUS:0028597618
SN - 0166-0462
VL - 24
SP - 301
EP - 322
JO - Regional Science and Urban Economics
JF - Regional Science and Urban Economics
IS - 3
ER -