Housing Affordability and Household Mobility

Abstract

Post-2008 financial crisis, regulators imposed stricter lending requirements for mortgages. We use a difference-in-differences strategy to examine the impact of these restrictions on household mobility. We find that restrictions on debt-to-income (DTI) ratios for mortgages led to increased outmigration from areas with less affordable homes. The effect is stronger in high-income areas, where individuals can afford to move. These findings suggest that housing affordability has a significant impact on household mobility.

Keywords: Migration, DTI ratios, Mobility, Affordability