Homeowners turned houses into assets for renovation and checking accounts for daily bills.

Evidence

For what sorts of consumptive purposes were households using extracted equity? Figure 10 shows the percentage of all homeowners who report using an outstanding home equity loan or cash taken out from refinancing for the given type of purpose. Note that homeowners who have multiple home equity loans could be counted for multiple purposes. Over time, we see statistically significant increases in the percentage of homeowners who borrow against their house for two different sets of purposes: investments and home renovations on the one hand, and paying daily living expenses and bills on the other hand. This fits with the view that homeowners increasingly saw their houses as assets and sought to leverage against them in order to maximize their market value and increase saleability (e.g. by installing luxury kitchens). But they also increasingly saw them as tools to fund consumption by covering living expenses and paying off bills. — Neil Fligstein & Adam Goldstein, The Emergence of a Finance Culture in…, 133

Categorization

• XREF: Echoes the ATM-house metaphor and the broader thesis that dwellings became extractive financial instruments — resonates with the DIY-home-equity-liquidity literature. — connects to: Upper-middle households increasingly treated homes as leverage assets. — Neil Fligstein & Adam Goldstein, The Emergence of a Finance Culture in…, 66; Private equity firms have remade family rental homes into portfolios of financialized asset classes — Paul Langley, Assets and Assetization in…, 41

Related

• Upper-middle households increasingly treated homes as leverage assets. (similarity 0.86)
• Private equity firms have remade family rental homes into portfolios of financialized asset classes (similarity 0.81)
• Households signal financialization through risk-taking, relaxed debt attitudes, and speculative strategies (similarity 0.80)

Broader Connections

• Private equity firms have remade family rental homes into portfolios of financialized asset classes #expands (0.85) — Paul Langley, Assets and Assetization in…, 41