Project: ASSETS, NEIGHBORHOODS, AND CHILDREN’S OUTCOMES

Sponsor: Ford Foundation, Freddie Mac Foundation
Status: In process
IPS Staff: Joseph Harkness and Sandra J. Newman (PIs), David Kantor, Amy Robie, and Laura Vernon-Russell

Purpose and Approach
Several rigorous studies have found that homeownership has large, positive effects on children’s well-being and life prospects. Our earlier studies found that these positive impacts were especially pronounced for lower-income families, and that homeownership was better than renting even in a “bad” neighborhood. While these findings lend empirical support to homeownership promotion policies, they also raise a number of intriguing questions about why, under what conditions, and for whom homeownership is beneficial to children’s development. The current project uses data from
the Child Development Supplements of the Panel Study of Income Dynamics to examine whether homeownership is equally beneficial to whites and blacks.

The answer to this question is not obvious. Blacks may not benefit equally from homeownership because past research demonstrates that housing market discrimination limits their access and choices. On the one hand, if black homebuyers experience less discrimination than black renters, it is possible that homeownership may have a more positive impact on black children than white children. Outcomes studied include standardized reading and math test scores, behavior problems, and maternal depression. Multivariate regression analysis was used to control for the socioeconomic circumstances of children’s families.

Results
Preliminary results suggest that among whites, owners’ children have better outcomes than renters’ children, but there is no such difference for blacks. However, this result occurs not because children of white owners do particularly well, but because children of white renters do poorly: Children of white renters do worse than children of black renters, despite whites having many socioeconomic advantages (such as higher incomes and more two-parent families) compared with
blacks. These results suggest that homeownership, in itself, does not have a causal effect on children’s outcomes. It may be that homeownership serves as a kind of litmus test for whites, filtering out the minority of families with low achieving children. For blacks, who confront greater hurdles in attaining homeownership, housing tenure does not serve this function.

Publications
Harkness, J. and S. Newman (2005). “Homeownership in Black and White: Racial Differences in Homeownership and Children’s Outcomes.” Association for Public Policy Analysis and Management Research Conference, November 3, Washington, DC.

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