The impact of diminished housing wealth on health in the United States: evidence from the Great Recession.
The sharp decline in home values in many industrialized and developing countries was one of the most evident facets of the global economic recession of 2008. Using data from the Panel Study of Income Dynamics (PSID) for 2007-2011, this study examines how the decline in housing wealth affected the psychological and physical health and health-related behaviors of 4007 U.S. households who were homeowners in 2007. We focus on two mechanisms that could account for how the drop in housing wealth affects health: increase in stress and negative changes in health-related behaviors. Controlling for the changes in non-housing wealth and employment status during the recession, the decline in housing wealth is associated with a small but statistically significant increase in psychological distress. Psychological health deteriorates more as the housing wealth relative to total wealth decreases. Finally, homeowners who have difficulties with mortgage payments report substantial increases in psychological distress and have higher rates of depression. These findings, combined with limited evidence of the change in health-related behaviors, suggest that the increase in stress is the main cause of the adverse health outcomes.
Department of Human Sciences, Ohio State University, 1787 Neil Avenue, 115C Campbell Hall, Columbus, OH 43210, USA. Electronic address: yilmazer.2@osu.edu.
Tansel
T
Yilmazer
Department of Financial Planning, Housing and Consumer Economics, University of Georgia, 202 Consumer Research Center (House C), 415 Sanford Drive, Athens, GA 30602, USA. Electronic address: pbabiarz@uga.edu.
Patryk
P
Babiarz
Department of Human Sciences, Ohio State University, 1787 Neil Avenue, 265L Campbell Hall, Columbus, OH 43210, USA. Electronic address: liu.869@buckeyemail.osu.edu.
Fen
F
Liu
D057172:Economic Recession; D004651:Employment; D005260:Female; D006304:Health Status; D006798:Housing / Q000191:economics*; D006801:Humans; D008137:Longitudinal Studies; D008297:Male; D008603:Mental Health / Q000706:statistics & numerical data*; D008875:Middle Aged; D044469:Racial Groups / Q000706:statistics & numerical data; D012959:Socioeconomic Factors; D013315:Stress, Psychological / Q000453:epidemiology; D014481:United States
Foreclosures; Health-related behaviors; Housing wealth; Mortgage; Physical health; Psychological distress; Recession; U.S.