Full Citation

Title: The McMansion Curse: Housing Size Inequality, Status Competition and House Valuation in American Suburbs

Citation Type: Miscellaneous

Publication Year: 2018

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Abstract: Despite a major upscaling of single-family houses since 1980, house satisfaction has remained steady in American suburbs. At any point in time, however, house satisfaction rises with house size. This Easterlin paradox in the realm of housing can be explained by upward-looking comparisons in the size of neighboring houses. Combining data from the American Housing Surveys with an original dataset of three million suburban houses built from 1920 to 2009, I find that the construction of so-called “McMansions” lowers the satisfaction that neighbors derive from a rise in their own house size. Upward-looking comparisons are stronger among people living in larger houses and decrease with the distance from McMansions. I provide further evidence that homeowners exposed to the construction of big houses in their neighborhood value their own home less, and are more likely to upscale to a bigger home and subscribe to a new mortgage.

Url: http://www.haas.berkeley.edu/groups/marketing/sics/pdf_2018/paper_b.pdf

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Authors: Bellet, Clement, S

Publisher: BerkeleyHaas

Data Collections: IPUMS NHGIS

Topics: Housing and Segregation, Other

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