Penn IUR Publications

Document Type

Journal Article

Date of this Version

October 1989


Copyright The American Real Estate and Urban Economics Association (AREUEA). Reprinted from Journal of the American Real Estate and Urban Economics Association, Volume 17, Issue 4, Winter 1989, pages 389-402.


Economics, Economic Development and Real Estate, Housing and Community Development


This paper utilizes micro data to directly quantify the impact of mortgage underwriting criteria on individual homeownership propensities. To determine whether a family is constrained by these criteria, the optimal home purchase price is estimated. The results indicate that wealth and income constraints both reduce homeownership propensities, with a stronger impact for wealth constraints. Mortgage market innovations of the early 1980s seem to have reduced these effects. The research indicates, however, that even in well-developed capital markets, the presence of borrowing constraints adversely affects homeownership propensities.



Date Posted: 06 July 2006

This document has been peer reviewed.