Housing Dynamics of Older Americans in the 21st Century

The Life-Cycle Hypothesis suggests that households save during their working years and then draw down those savings in retirement. Housing equity constitutes a large portion of most retiree’s savings portfolios, yet older households are not using their accumulated housing equity to help increase consumption in retirement and often die with large sums of housing equity. This dissertation explores housing equity use by older Americas in three ways. Chapter 1 looks at homeownership and moving rates of older Americans and how having a guaranteed source of income from a defined benefit plan may have mitigated some of the effects of the Great Recession. Chapter 2 investigates how a potential increase in out-of-pocket medical spending for older households may cause them to engage in precautionary using their home. Chapter 3 concludes this dissertation by exploring how forgoing time and money spent on home maintenance allows older households to extract housing equity.