Household mortgage demand: a study of the UK, Australia and Japan

Abstract

Purpose: Homeownership has been the main focus of housing policies in most countries. Typical means that households use to achieve homeownership is to take out a loan and supplement this with accumulated wealth for a downpayment. This paper aims to analyze the mortgage demand behavior of households in the UK, Australia and Japan. Design/methodology/approach: Using three panel data sets, HILDA for Australia, KHPS for Japan and USS for the UK, the paper estimates three equations using ordinary least squares: mortgage demand function, housing demand function and initial loan to value ratio function. Findings: Though homeownership is a preferred tenure and the mortgages are “recourse” loans, hou..