Homeowner-renter wealth inequalities and position in the rural-urban hierarchy

Abstract

Prior scholarship has documented and tried to explain growing inequalities in individual wealth holdings—especially between homeowners and renters—but has not considered the role of residential position in the rural-urban hierarchy. We estimate fixed-effect models of one’s rank in national net, housing and financial wealth distributions during the 2010–2018 period, based on Norwegian register data on prime-age individuals. We find dramatic geographic differences in trajectories of wealth accumulation that are strongly conditioned by tenure. Residing longer in a more urbanized area—especially in the central Oslo region—results in a substantially higher net wealth position only for homeowners. This result is driven overwhelmingly by their greatly superior gains in housing wealth over the period. By contrast, the net wealth and financial wealth positions for those who always rent are virtually indistinguishable across the hierarchy, regardless of duration of residence. Our evidence suggests that the positive correlation between earnings and rent levels across the rural-urban hierarchy yields this result.