Homeownership, housing capital gains and self-employment

John P. Harding, Stuart S. Rosenthal

Research output: Contribution to journalArticlepeer-review

31 Scopus citations


This paper measures the impact of individual-level housing capital gains on transitions into and out of self-employment. Drawing on special features of the 1985–2013 American Housing Survey (AHS) panel, our most robust models control for recent expenditures on home maintenance, MSA-by-year fixed effects, lagged proxies for wealth and other household attributes. Net of home maintenance, a 20% real increase in home value over a two-year period raises the likelihood of entry into self-employment by roughly 1.5 percentage points; housing capital losses have little effect on exits. Controlling for house fixed effects, self-employed homeowners are also more likely to hold a HELOC, facilitating easy, low-cost access to home equity that could be used to cover business expenses. These and other estimates suggest that links between homeownership and self-employment are strong enough to be important when home prices are rising rapidly, but modest when housing capital gains are limited or negative.

Original languageEnglish (US)
Pages (from-to)120-135
Number of pages16
JournalJournal of Urban Economics
StatePublished - May 1 2017


  • Homeownership
  • Housing capital gains
  • Mortgage
  • Self-employment

ASJC Scopus subject areas

  • Economics and Econometrics
  • Urban Studies


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