Homeowner Borrowing and Housing Collateral: New Evidence from Expiring Price Controls

• 成果类型: Article
• 署名作者: Defusco, Anthony A.
• 署名单位: Northwestern University
• 刊物名称: JOURNAL OF FINANCE
• ISSN/ISSBN: 0022-1082
• DOI: 10.1111/jofi.12602
• 发表日期: 2018
• 页码: 523-573
• 关键词: liquidity constraints; household consumption; predictable changes; financial wealth; income; debt; credit; equity; HOME; expenditure

摘要

I empirically analyze how changes in access to housing collateral affect homeowner borrowing behavior. To isolate the role of collateral constraints from that of wealth effects, I exploit the fully anticipated expiration of resale price controls on owner-occupied housing in Montgomery County, Maryland. I estimate a marginal propensity to borrow out of housing collateral that ranges between $0.04 and $0.13 and is correlated with homeowners' initial leverage. Additional analysis of residential investment and ex-post loan performance indicates that some of the extracted funds generated new expenditures. These results suggest a potentially important role for collateral constraints in driving household expenditures.