Changes in City-Level Foreclosure Rates and Home Prices through the Great Recession and Depressive Symptoms among Older Americans

Abstract

The changing economic fortunes of cities influence mental health. However, the mechanisms through which this occurs are underexplored. I address this gap by investigating the Great Recession of 2007-2009. Using the National Social Life, Health, and Aging Project survey (N = 1,341), I study whether rises in cities’ home foreclosure rates and declines in median home prices through the Great Recession increase older persons’ depressive symptoms. I also study possible mediation through household assets declines. I find that increases in cities’ home foreclosure rates and declines in median home prices increase depressive symptoms beyond the effects of personal financial losses. Results show no evidence of mediation through asset loses, suggesting effects through other channels. Supplementary analyses reveal less direct links between changes in city-level unemployment rates and median household incomes and changes in depressive symptoms.