Likely to be satisfied with their homes and

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likely to be satisfied with their homes and neighborhoods, more likely to participate in voluntary and political activities and more likely to stay in their homes longer periods of time. Some doubt still exists, however, whether these relationships are causal, since most of the studies do not adequately account for the self-selection of households to owner and renter occupancy. Evidence of the impacts of homeownership on other social variables is more sparse and less consistent. The research on the impacts of homeownership on both perceived control and socially desirable youth behaviors is simply too sparse to draw conclusions. More troubling, very little research exists on potential negative social impacts of homeownership, for example the effect of foreclosures on psychological and physical health and on neighborhood stability. Finally, the consensus view is that homeownership leads to less mobility, especially in times when many households have negative equity, making labor markets less efficient. 72 Karsten Jeske, Dirk Krueger, and Kurt Mitman, “Housing and the Macroeconomy: The Role of Implicit Guarantees for Government Sponsored Enterprises”, University of Pennsylvania Working Paper, February 2010. 73 Gervais, Martin (2001): Housing Taxation and Capital Accumulation, Journal of Monetary Economics, 49, 1461-1489. 74 James Poterba and Todd Sinai (2008), “Tax Expenditures for Owner-Occupied Housing: Deductions for Property Taxes and Mortgage Interest and the Exclusion of Imputed Rental Income”, National Bureau of Economic Research Working Paper. 75 Even this, however, is heavily debated. As Alan Greenspan notes in a speech to the Conference on Housing, Mortgage Finance, and the Macroeconomy, Federal Reserve Bank of Atlanta, Atlanta, Georgia, dedicated to the theme of Government-sponsored enterprises ( ): “Some observers have suggested that the availability of fixed-rate mortgages is tied to the size of GSE portfolios. We see little empirical support for this notion. For example, we have found no evidence that fixed-rate mortgages were difficult to obtain during the early 1990s, when GSE portfolios were small. Indeed, the share of fixed-rate mortgage originations averaged slightly less than 80 percent in 1992, when GSE portfolios were small, and averaged 66 percent in 2004, when GSE portfolios were large. Clearly, these data do not support the proposition that the size of the GSEs' portfolios positively contributes to the availability or popularity of fixed-rate mortgages. It is, of course, mortgage securitization, and not GSE portfolios, that is the more likely reason for the continued market support for the popular thirty-year fixed-rate mortgage.” 76 Raphael Bostic and Stuart Gabriel analyzed census tract averages of GSE purchase activity and housing outcomes for census tracts with median incomes at the boundaries of those specified in the GSE housing goals and those specified in the 1977 Community Reinvestment Act. An
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Christopher Reinemann
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