Intergenerational Homeownership and Mortgage Distress
Abstract: Rates of US homeownership have declined in the past two decades, and the decline has been especially pronounced for young adults. Motivated by recent research that explores the ways in which personal experiences can affect financial attitudes and beliefs, we explore whether the negative homeownership experiences of parents during the 2008 financial crisis could have caused their children to view homeownership less favorably. We find that parental mortgage distress negatively correlates with the probability that a child will purchase a home, and we explore various channels through which this link may occur.
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Provider: Federal Reserve Bank of Cleveland
Part of Series: Economic Commentary
Publication Date: 2020-06-18