Are Low- and Moderate-Income Homeownership and Neighborhood Context Associated with Social Capital?

Publication Date

October 2008

Author(s)

Johanna K.P. Greeson, Mathieu Despard, Michal Grinstein-Weiss, Roberto G. Quercia, Yeong Hun Yeo

Client/Funder

Ford Foundation

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Research reveals a significant difference in the level of social capital — that is, a desirable social outcome that captures resources that can be drawn upon to solve problems — between low- to moderate-income homeowners and renters.

Today, more than two-thirds of U.S. families own their own homes. Despite this growth, there have been relatively few studies that have examined the impact of homeownership on low-and moderate-income (LMI) households, specifically. Therefore, important questions related to the outcomes of homeownership among lower income and minority individuals and families have  emerged.

This study uniquely uses a sample of LMI homeowners and a comparison group of renters who participated in a quasi-experiment designed to investigate homeownership effects by income. To identify a relationship between LMI homeownership and social capital, and to disentangle the effects of such homeownership from neighborhood contextual factors, the present study uses  hierarchical linear modeling to regress homeownership and neighborhood-level variables concurrently on social capital. We define social capital as a desirable social outcome that captures “resources” that can be drawn upon to solve problems.

Results indicate a significant difference in the level of social capital between LMI homeowners and renters. At the neighborhood-level, economic disadvantage and neighborhood stability are significant predictors of social capital. Policy implications and future research directions are forwarded.