The Review of Corporate Finance Studies Vol. 11 No. 3 2022

Does Homeownership Reduce Wealth Disparities for Low-Income and Minority Households?

Ashleigh Eldemire¹; Kimberly F Luchtenberg²; Matthew M Wynter³

¹ Haslam College of Business, University of Tennessee , USA · ² Kogod School of Business, American University , USA · ³ College of Business, Stony Brook University , USA

Abstract

We use the U.S. Department of Housing and Urban Development’s Housing Choice Voucher program as a setting to evaluate the interaction of homeownership and race on the wealth accumulation of low-income households. Using a within-treatment difference-in-differences framework, we establish that low-income households that receive assistance in owning a home experience increased wealth accumulation relative to their tenure as renters. These wealth gains are not present among low-income minority households. Our findings provide evidence that homeownership is a driver of wealth formation for low-income households and that homeownership does not inherently reduce racial disparities in wealth.

DOI

10.1093/rcfs/cfac016

Volume

11

Issue

3

Pages

465-510

Language

en

Sources

bibtex:phds-export.bib openalex crossref

Cite

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