HOMEOWNERSHIP AND NEIGHBORHOOD SATISFACTION AMONG LOW- AND MODERATE-INCOME HOUSEHOLDS

Most research on homeownership is conducted on nationally representative samples of homeowners and fails to isolate the unique experience of low-and moderate-income (LMI) homeowners. Given the interest of policymakers in promoting homeownership among LMI households over the past 20 years, along with the apparent role played by risky borrowers-many of whom are low-income-in the current housing market crisis, it is important to evaluate both economic and social outcomes for this subgroup of homeowners. Using a matched set of LMI owners and renters in the 2007 Community Advantage Program (CAP) panel, we assess the effect of homeownership on neighborhood satisfaction. By including various individual and neighborhood characteristics as covariates, we employ multilevel modeling and propensity score matching to address the nested structure of the data and endogeneity issues. Findings indicate that homeownership is an important predictor of neighborhood satisfaction among LMI households, even when controlling for a host of socioeconomic, demographic, and neighborhood characteristics. This may suggest that homeownership can serve as a viable way to improve neighborhood satisfaction among LMI households. This is important as neighborhood satisfaction is highly associated with overall quality of life.