Negative home equity and job mobility

To control for self-selection into negative home equity, we consider homeowners who fall into negative home equity because of an exogenous price decline in their house. We compare them to homeowners with positive equity. Negative home equity has a moderate negative effect on the probability to switch jobs. If a household plunges into negative home equity, then the head of the household is about 5.2% less likely to switch jobs.

Read also: Discussion Paper 323 'Negative Home Equity and Household Mobility: Evidence from Administrative Data'.