Homeownership, house prices, and marriage stability

Abstract This article investigates the relationships among marital stability, divorce, homeownership, and housing prices. Using data from the China Family Panel Studies (CFPS), we find that, after controlling for observables, homeownership is associated with a 23% reduction in the overall divorce rate. Our results also indicate that while homeownership promotes marital stability, rising housing prices increase the likelihood of divorce for homeowners relative to renters. These findings suggest that increased real estate values provide financial flexibility, potentially easing the economic frictions typically associated with divorce, including the need to acquire alternative housing.