How Much Does Housing Affect Retirement Security? An NRRI Update

The brief’s key findings are:

• Net housing wealth, a major asset for most households, depends on the value of the house and the amount of mortgage debt.
• The analysis tests how below-trend house prices and high housing debt affected the 2013 National Retirement Risk Index (NRRI).
• The results show that the impact of house prices and, particularly, debt, was large; absent these effects, the NRRI would have been 44 percent rather than 52 percent.
• Looking past 2013, the continuing recovery in house prices will help the NRRI a bit, but it is unclear whether the high-debt pattern is temporary or permanent.