Abstract
Choosing between rented housing and homeownership, the so called housing tenure choice, is a key decision made by each household. Therefore housing economists often seek an answer to the question which factors have an impact on this decision. The paper investigates potential tenure choice determinants using probit regression model based on the sample data. Results of the analysis, making use of the investigation of EU-SILC in the CR, showed that tenure choice is affected by the factors similar to those in other countries – household income, marital status of the household head and household size (persons per household). By contrast, the influence of other demographic characteristics, such as gender and age of head of the household has not been confirmed. The econometric model has also made it possible to evaluate potential impact of these factors on housing related expenses of households. In addition to the logical influence of household income, tenure choice decisions are significantly influenced by household size and residence in Prague, particularly in the rented housing sector.
Highlights
The quality of family life is affected by the place where the family lives, its location, its adequate floor area enabling sufficient privacy for the household members and many other aspects
Choosing between rented housing and homeownership, the so called housing tenure choice, is a key decision made by each household
Results of the analysis, making use of the investigation of EU-SILC in the CR, showed that tenure choice is affected by the factors similar to those in other countries – household income, marital status of the household head and household size
Summary
The quality of family life is affected by the place where the family lives, its location, its adequate floor area enabling sufficient privacy for the household members and many other aspects. That is why one of the key decisions made by any household is the choice between owning and renting their home, which is known in specialized literature as tenure choice. This issue has drawn the attention of researchers for many years. They focus mostly on identifying the determinants which are relevant to the decision of households to own or rent their housing as well as on establishing the degree of their impact. Tenure choice is typically analysed in connection with household mobility, housing attributes (dwelling characteristics), household attributes or as an element of consumption and investment decisions
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