Wellbeing at the Edges of Ownership: The Impacts of Housing Tenure, Social Capital, and Institutions

This paper presents a three-country analysis of the relationship between housing, indicators of social capital, and life satisfaction (a proxy for wellbeing) using cross-sectional data from national surveys in Australia, the UK and the US. Addressing a key policy debate we construct, for each jurisdiction, models of life satisfaction as a function of housing and social capital, with a view to better targeting policy interventions to achieve wellbeing outcomes. First, we show that the wellbeing premium associated with homeownership remains resilient despite housing market instability early in the 21st century. Second, we find that while social capital is an important independent positive influence on life satisfaction, its effect is weaker than that of housing tenure. Third, we include two measures of housing risk (repayment risk and investment risk). These position mortgagors on a continuum across the edges of owner-occupation, placing them closer to, or further from, the ‘ideal’ of outright ownership. The impact of these measures varies across the three countries, raising questions about the way life satisfaction at the edges of ownership may be shaped by institutional forces.