Homeownership and Residential Mobility during the "Lost Decades"

Using household survey data from the recent economically depressed period, we attempt to identify typical household characteristics by residential type and study whether households change their residence in different stages of life. We find that the general trend in residential choice is influenced by their socioeconomic backgrounds. Multinomial probit estimation results show that the probability of homeownership is higher in rural areas and increases with the age of household heads, income, and family size. In contrast, the probability of renting a home increases in urban areas along with rising mortgage rates. Moreover, despite market imperfection, there is a significant tendency among people to adjust residential size according to their needs in different stages of life. Indeed, there is a strong tendency for dwelling size to increase with household age, but it begins to reduce once households reach the age of 55. However, because of the small scale of this reduction in the late life-cycle, we conclude that post-war housing policies were not very supportive of the elderly.