Wealth and Wellbeing: the role of parental housing wealth in shaping youth health

Abstract

In Australia, two of the most pressing concerns are the state of the housing market and the declining health of youth. Whilst the two are intertwined, the impact of the housing market on youth health is not well understood. On the one hand, the family home is the most common form of wealth, and thus higher house prices translate to higher parental wealth, which has the propensity to benefit youth through greater resources and investments. However for youth, higher house prices make home ownership more unattainable. Thus, the net effect of changes in housing prices and housing wealth is ambiguous. This thesis identifies the causal effect of changes to housing wealth - through house prices - on the physical and mental health of adolescents and young adults living in the parental home. Using a first-difference model with year and local area fixed effects, I find that mental and physical health both fall with an increase in local house prices, in spite of evidence for increased parental investments. These findings are particularly salient for children in mortgaged households, and households with fewer economic resources. To the best of my knowledge, this thesis is novel, in that it is the first to empirically investigate the link between the wellbeing outcomes of Australian youth living at home and the variation in the housing wealth of their parents.