Negative Equity Does Not Reduce Homeowners' Mobility

By Sam Schulhofer-Wohl. 2012

131 citations recorded by the source corpus.

Some commentators have argued that the housing crisis may harm labor markets because homeowners who owe more than their homes are worth are less likely to move to places that have productive job opportunities. I show that, in the available data, negative equity does not make homeowners less mobile. In fact, homeowners who have negative equity are slightly more likely to move than homeowners who have positive equity. Ferreira, Gyourko and Tracy's (2010) contrasting result that negative equity reduces mobility arises because they systematically drop some negative-equity homeowners' moves from the data.

Subfields: Accounting, Economics and Econometrics, Finance

View Paper: https://www.semanticscholar.org/paper/e05536d3bfe831b144f5e85d19194f7a52bb0481

Citations in the corpus

• Employment Hysteresis from the Great Recession (2019, unknown): “First, and despite the possibility of negative-equity mortgages impedinghomeowner out-migration (Ferreira, Gyourko, andTracy 2010, 2011), several papers have argued that the Great Recession did not impede migration (Farber 2012; Schulhofer-Wohl 2012; Valletta 2013; Şahin et al. 2014).”