SEMINAR September 10, 2012: Dmytro Hryshko, University of Alberta

Moving to a Job: The Role of Home Equity, Debt and Access to Credit

Abstract

Using credit report data from two of the three major credit bureaus in the United States, we  infer (from addresses and new mortgages) with high certainty whether and where households move. We estimate how the patterns of moving relate to labor market conditions, personal credit, and homeownership using panel regressions with fixed effects which control for all constant individual-specific traits. We interpret the patterns through simulations of a dynamic model of consumption, housing, and location choice. We find that households with negative home equity move more than other households, in particular when employment growth is low while households with low, but positive, home equity are relatively less mobile---overall, negative home equity is not an important barrier to labor mobility.