Housing insecurity, financial hardship and mental health

Abstract

We examine the impact of housing insecurity on mental health. We use missed rental payments due to a shortage of money as a direct measure of housing insecurity and a difference-in-differences framework that allows us to differentiate the effect of housing insecurity from the effect of experiencing financial hardship more generally. We find that housing insecurity causes a decline in mental health. Further analysis reveals two important dimensions of heterogeneity: the duration of prior financial hardship and the intensity of housing insecurity. Renters in prolonged financial hardship and those who experience high levels of housing insecurity (defined as missing a rental payment and having a high rent to income ratio), experience the largest negative impacts on their mental health.