Location Efficiency and Mortgage Risks for Low-Income Households

Household energy expenditures, especially for transportation, are fairly inelastic. Their effects on low-income households may be significant, due to the potential for energy consumption to displace other types of consumption when energy prices rise. Using accessibility as a proxy for lower transportation costs, we test the hypothesis that low- and moderate-income residents are less likely default when they are located in more accessible places. We find that regional accessibility has almost no effect on risks of default, but local job diversity has moderate mitigating effect.