Housing Policies under Financial Constraints

• Applicant: Sebastian Golder
• Subject Area: Economic Policy, Applied Economics ; Accounting and Finance
• Term: since 2024
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 554426549

The proposed project, "Housing Policies under Financial Constraints", will be hosted by Arpit Gupta at New York University (NYU), Stern School of Business. The project investigates the impact of housing policies on households, particularly those facing financial constraints. It is divided into three subprojects that focus on different aspects of housing policies and their effects on housing allocation and household welfare. The first subproject explores the role of property taxes in affecting housing allocation among households in the US. Using an overlapping generations (OLG) model with housing tenure and location choices, this subproject analyzes the impact of property taxes on homeownership and regional migration. Preliminary findings suggest that higher property taxes can decrease house prices through a capitalization effect, making homeownership more accessible for financially constrained households. The second subproject examines the potential of higher property taxes to increase the low homeownership rate in Germany, considering the upcoming property tax reform. By adapting the OLG model from the first subproject to the German context, this part of the project will analyze how property tax changes influence housing allocation and homeownership in Germany. The third subproject addresses the challenges of climate change in the housing market and its implications for households. It investigates the effectiveness of various energy efficiency policies in the housing market and their impact on household welfare, focusing on financially constrained households. Again, an OLG model will be developed, allowing households to choose between renting and owning homes with different energy efficiency ratings. This subproject will analyze the welfare impacts of policies such as mandatory energy efficiency standards, subsidies for energy-efficient renovations, and property tax abatements for energy-efficient houses. The project will enhance the applicant's expertise in housing finance, public finance, and climate finance, fostering his collaboration with researchers at NYU Stern and expanding his international networks. The findings will provide insights into the role of various housing policies, offering policy recommendations to improve housing allocation and household welfare.

• DFG Programme: WBP Fellowship
• International Connection: USA
• Host: Professor Arpit Gupta, Ph.D.