In this paper, we study a household’s optimal life-cycle housing choices by calibrating a model with uninsurable … choose to convert illiquid home equity to liquid asset to finance non-housing consumption in the absence of lower borrowing … the importance of labor income and house price risks in housing decisions. In comparison to the benchmark case, a higher …

-Sponsored Enterprises. We set up an economy with a housing and mortgage market where the government provides banks with insurance against …

uninsurable idiosyncratic risks, where the agents make entrepreneurial, housing and bankruptcy choices. In the model, house is …

, mortgage innovation, and life-cycle housing choices contribute to the aggregate residential investment dynamics. Our analysis … is based on a life-cycle housing model consistent with evidence on housing choices from the NLSY …

for approximately thirty percent of the market value of the housing stock and is approximately equal to forty percent of …

Are households more likely to be homeowners when “housing risk” is higher? We show that home-ownership rates and loan … inference is confounded by house price levels, which are systematically correlated with housing risk in an intuitive way: in …