Home ownership, labour markets and the economic crisis
In recent decades, a growing body of academic literature has focused on the possible negative effects of high levels of home ownership, especially on labour markets. More-than-optimal levels of home ownership may impede the mobility of workers, resulting in higher unemployment rates in some European regions. Against that backdrop, a simple model was devised to test the relationship between home ownership, mobility and unemployment. Recent macroeconomic data published by Eurostat suggest that both the variables of mobility and home ownership have had a significant impact on the dynamics of unemployment rates across the EU28.
This ECRI Commentary is one of two on the topic of home ownership in the EU, published simultaneously by the same author; ECRI Commentary No.15, entitled “Recent trends in EU home ownership” looks at the major developments since the crisis of 2008.