Authors: Harry Houillon, Natalie Xiaoqi Liu, Helen X. H. Bao
Year: 2026
Status: Under Review
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Abstract
This paper presents the results of a first quantitative study into the relationship between house prices and fertility rates at the local authority district spatial scale in the United Kingdom (UK). The study focuses on London Boroughs, from 2001-2020, and empirically examines the connection between fertility rates and house prices and interacts house prices with a baseline measure of home ownership. The core OLS estimates indicate that when borough-level home ownership rates are low (i.e., when there are lots of renters in the borough), a 1% increase in house prices is associated with a small decrease in fertility rates. However, when borough-level home ownership rates increase beyond 44.4%, this marginal effect turns positive, and increases in house prices are found to increase fertility rates, due to positive wealth effects that accrue to existing home owners. These findings are robust to a number of alternate model specifications, including the use of different independent variables and alternative lag effects. Additionally, the instrumental variable approach is employed to address potential endogeneity concerns, further strengthening the validity of our results. Finally, the results are in line with the predictions of qualitative evidence from London and of existing literature (Dettling and Kearney, 2014; Aksoy, 2016), and illustrate the importance of tenure patterns in shaping the relationship between housing and fertility.