Elderly Households and Housing Wealth: Do They Use It or Lose It?

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dc.contributor.author Walker, Lina
dc.date.accessioned 2007-04-25T15:28:31Z
dc.date.available 2007-04-25T15:28:31Z
dc.date.issued 2004-01
dc.identifier.uri http://hdl.handle.net/2027.42/50549
dc.description.abstract Over 80 percent of households in their 50s are homeowners and housing wealth accounts for over half of total household wealth for most of these homeowners. The evidence in the literature on whether the elderly are consuming their housing wealth has been mixed. Because home sales are infrequent and a high proportion of the elderly continue to own in old age, it appears that the elderly are not consuming housing wealth. There are, however, indications that housing wealth may be a form of self-insurance and that housing wealth is consumed, albeit at very old ages. To date, however, the evidence to support that hypothesis has been weak. This paper examines whether predictors of housing sales are consistent with the insurance story by looking at the extent to which indicators of changes in economic status and access to alternate insurance explain housing sales. The paper also examines the extent to which changes in health status predict housing sales. The results of the probit appear to indicate that, by and large, housing sales in old age for single households is mostly driven by worsening health. Widowhood has a large effect on increasing the probability of selling the house and the effect is larger if the husband is the surviving spouse. There are indications that poor married homeowners are consuming housing wealth and also indications that married households are responding to Medicaid tax incentives. This evidence seems to suggest that, at least among married households, housing decisions are financially motivated; however, the evidence does not by itself validate the insurance story. en
dc.description.sponsorship Social Security Administration en
dc.format.extent 391294 bytes
dc.format.mimetype application/pdf
dc.language.iso en_US en
dc.publisher Michigan Retirement Research Center, University of Michigan, P.O. Box 1248, Ann Arbor, MI 48104 en
dc.relation.ispartofseries WP 2004-070 en
dc.title Elderly Households and Housing Wealth: Do They Use It or Lose It? en
dc.type Working Paper en
dc.subject.hlbsecondlevel Population and Demography
dc.subject.hlbtoplevel Social Sciences
dc.contributor.affiliationum MRRC en
dc.contributor.affiliationumcampus Ann Arbor en
dc.description.bitstreamurl http://deepblue.lib.umich.edu/bitstream/2027.42/50549/1/wp070.pdf en_US
dc.owningcollname Retirement Research Center, Michigan (MRRC)
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