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Author: Le, Vincent C.
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Le, Vincent C. |
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The Relationship between Household's Risk Preference and the Homeownership Decisions among Young Adults in Changing Housing Market Conditions Ph.D. Dissertation, Department of Programs in General Human Ecology, Kansas State University, 2018 Cohort(s): NLSY79, NLSY97 Publisher: ProQuest Dissertations & Theses (PQDT) Keyword(s): Home Ownership; Housing/Housing Characteristics/Types; Risk Perception Permission to reprint the abstract has not been received from the publisher. For many decades, the American Dream of homeownership has been a source of pride and one of the traditional ways to improve financial and non-financial well-being for American households. However, during the recent housing crisis, millions of homeowners lost their homes or experienced negative home equity due to job loss, reductions in work hours, or a decline in home values. The recent housing crisis made many individuals and families rethink their American Dream. As with most investments, there are some risks associated with owning a home, especially when housing markets are volatile and the economy is uncertain. Understanding the relationship between household's risk preference and homeownership decisions may help households make better and more informed decisions regarding their housing tenure choice. This study investigates the relationship between household's risk preference and homeownership decisions among young adults made during the stability in the housing market, which occurred around 1993, and during the decline in the housing market, which occurred around 2010. This study also examined demographic and economic characteristics of homeowners during those periods. Two separate datasets from the National Longitudinal Study of Youth 1979 and the National Longitudinal Study of Youth 1997 were utilized to address research questions and research hypotheses under the lens of the expected utility theory. The results showed shifts in household's risk preferences, homeownership rates, and demographic and economic characteristics between periods. Compared to households who preferred lowest risk level, households who preferred highest risk level were more likely to own a home in both periods. The relationships between household’s risk preference and homeownership decisions did not change between periods. However, some relationships between household's demographic and economic characteristics and homeownership decisions changed between periods. |
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Bibliography Citation
Le, Vincent C. The Relationship between Household's Risk Preference and the Homeownership Decisions among Young Adults in Changing Housing Market Conditions. Ph.D. Dissertation, Department of Programs in General Human Ecology, Kansas State University, 2018. |