Housing Crisis and Child Well-being: The Effects of Foreclosure on Children and Youth

• In Event: 311 - Regular Session. Impact of Hard Times

Abstract

The housing market crash in the mid-2000s was characterized by unusually high rate of mortgage delinquencies and foreclosures. Thus, many families faced the prospect of losing their homes. In this paper, I use a unique dataset linking from the 2008 Survey of Income and Program Participation with individual foreclosure event records from RealtyTrac to examine the effects of foreclosure on changes in child well-being. This data set enables me to follow individuals in families facing foreclosure over time, even if they change their residence. Results from random-effects models suggest that foreclosure is associated with lower economic well-being, less frequent parent-child interaction, an increased likelihood of changing schools, lower school engagement, less participation in extracurricular activities, and lower neighborhood trust. Results from fixed effects models suggest that changes in foreclosure status are associated with a decrease in economic well-being and lower rates of participation in extracurricular activities, and increase in participation in government benefit programs.

Author

• Laryssa Mykyta, U.S. Census Bureau