Is Homeownership a Foundation for Success?

In the past homeownership was assumed to be more beneficial to children than rental housing. Now there is research demonstrating otherwise.

Several recent research studies have found that the benefits of homeownership on children were overstated. In the Center for Housing Policy’s Insights from Housing Policy Research series, Maya Brennan reviews new research on the effects of homeownership on children and discusses what policy implications this research might have.

Research studies in the past have found connections between homeownership and positive outcomes such as higher test scores, higher graduation rates, fewer behavioral problems, lower rates of teenage parenthood, fewer problems related to allergies and asthma, and better physical health. New research shows that it does not really matter whether a child lives in an owned or rented home. Other factors including residential stability, neighborhood quality, school quality, and the parents themselves are more influential for a child’s well-being.

Researchers are reassessing this data by using sophisticated study design and analytic methods, identifying and controlling for other possible contributing factors, and reviewing the selection of populations to be studied. After accounting for the differences between homeowners and renters, homeownership has little effect on children’s educational outcomes, children’s behavior, and children’s health. Instead, home environment and neighborhood characteristics influence test scores and achievement. The research also found that parents who choose homeownership have personality traits that are beneficial to children’s education. This may lead researchers to incorrectly conclude that homeownership is the reason for the benefits.

Policymakers have used the earlier body of research to promote homeownership for low and moderate-income households. These homeownership programs may not be yielding the intended benefits. Although, more research needs to be done to determine what types of housing policies will work best to improve children’s outcomes, current research implies that housing policy should be re-balanced to equally value both rental housing and permanent forms of homeownership.

Click here to learn more about this research and read the full article.