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Effects of house prices on health: New evidence from Australia

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  • Atalay, Kadir
  • Edwards, Rebecca
  • Liu, Betty Y.J.

Abstract

Recent house price variation has strongly affected households’ housing wealth and debt, yet the non-economic consequences of these changes in housing wealth are still poorly understood. Using a sample of 19,000 individuals from the Household, Income and Labour Dynamics in Australia Survey (HILDA) for 2001–2015, we examine the relationship between house price fluctuations and individual health by exploiting large exogenous changes in house prices in Australia. We find that an increase in local house prices is associated with a positive effect on the physical health of outright owners and a negative effect on the physical and mental health of renters. Improvements in physical health for outright owners can be partially attributed to health-related investments and behaviours such as a reduction in weight, an increase in physical exercise and an increase in time allocated to home production. These findings support the presence of a health-wealth gradient through the wealth mechanism distinct from the effects of local area amenities and macroeconomic conditions. Our findings highlight some of the often-overlooked social impacts – both positive and negative – of fluctuations in the housing market.

Suggested Citation

  • Atalay, Kadir & Edwards, Rebecca & Liu, Betty Y.J., 2017. "Effects of house prices on health: New evidence from Australia," Social Science & Medicine, Elsevier, vol. 192(C), pages 36-48.
    • Handle: RePEc:eee:socmed:v:192:y:2017:i:c:p:36-48
    DOI: 10.1016/j.socscimed.2017.09.008
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    3. Atalay, Kadir & Li, Ang & Whelan, Stephen, 2021. "Housing wealth, fertility intentions and fertility," Journal of Housing Economics, Elsevier, vol. 54(C).
    4. Richard H. Rijnks & Stephen Sheppard, 2018. "Occupant Well-Being and House Values," Department of Economics Working Papers 2018-05, Department of Economics, Williams College.
    5. Edwin S. Wong & Vanessa M. Oddo & Jessica C. Jones-Smith, 2020. "Are Housing Prices Associated with Food Consumption?," IJERPH, MDPI, vol. 17(11), pages 1-11, May.
    6. Tao Li & Yi-Tong Zhang & He-Wen Zhu & Peng-Ju Liu, 2022. "Floating Population, Housing Security and Family Medical Economic Risk," Sustainability, MDPI, vol. 14(18), pages 1-17, September.
    7. Bénédicte Apouey & Isabelle Chort, 2018. "Are rising house prices really good for your brain? House value and cognitive functioning among older Europeans," Working Papers hal-02141060, HAL.
    8. Moulton, Stephanie & Rhodes, Alec & Haurin, Donald & Loibl, Cäzilia, 2022. "Managing the onset of a new disease in older age: Housing wealth, mortgage borrowing, and medication adherence," Social Science & Medicine, Elsevier, vol. 314(C).
    9. Chen, Zisen & James, Jonathan, 2022. "Put your FTSE down: Wealth shocks and road traffic collisions," Social Science & Medicine, Elsevier, vol. 314(C).
    10. Xu, Yuanwei & Wang, Feicheng, 2022. "The health consequence of rising housing prices in China," Journal of Economic Behavior & Organization, Elsevier, vol. 200(C), pages 114-137.
    11. Zhi Cai & Yan Tang & Kai Chen & Guifeng Han, 2019. "Assessing the Heat Vulnerability of Different Local Climate Zones in the Old Areas of a Chinese Megacity," Sustainability, MDPI, vol. 11(7), pages 1-15, April.
    12. Peter Butterworth & Carmel Poyser & Aino Suomi, 2021. "Mental Health," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 54(4), pages 530-541, December.
    13. Atalay, Kadir & Edwards, Rebecca, 2022. "House prices, housing wealth and financial well-being," Journal of Urban Economics, Elsevier, vol. 129(C).
    14. Isabelle CHORT & Bénédicte APOUEY, 2018. "Are rising house prices really good for your brain? House value and cognitive functioning among older Europeans," Working Papers 2017-2018_7, CATT - UPPA - Université de Pau et des Pays de l'Adour, revised Oct 2018.
    15. Tran, My & Gannon, Brenda & Rose, Christiern, 2023. "The effect of housing wealth on older adults’ health care utilization: Evidence from fluctuations in the U.S. housing market," Journal of Health Economics, Elsevier, vol. 88(C).
    16. Sang Jun Eun, 2019. "Contextual Association between Political Regime and Adolescent Suicide Risk in Korea: A 12-year Repeated Cross-Sectional Study from Korea," IJERPH, MDPI, vol. 16(5), pages 1-13, March.

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