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Mortgage and home equity insurances for home owners and rental insurancefor tenants
KTH, School of Architecture and the Built Environment (ABE), Real Estate and Construction Management.ORCID iD: 0000-0003-4849-0726
2009 (English)Report (Other academic)
Abstract [en]

Households face many different kinds of risks that are related to ownership and tenancy. Forinstance, home owners face both financial and capital risk, whereas tenants face risks relatedto rent level. The present paper focuses on mortgage and home equity insurance instruments for home owners, and rent insurance instruments for tenants. Mortgage and home equityinsurances might improve both households’ as well as lenders possibilities to manage risksrelated to home purchases, financial commitments and lending. Mortgage insuranceinstruments aims at mitigating the risk of mortgage default and loan losses resulting from a foreclosure process, while home equity insurance provide protection against capital losses.Furthermore, these insurance instruments might also be usable for expanding home ownershipfor low-income households. This paper also discusses a rental insurance policy as analternative to traditional rent regulation. A main feature of this policy is that landlords are supposed to be obliged to offer tenants rental insurance against strong increases in marketrents

Place, publisher, year, edition, pages
2009. , 34 p.
Keyword [en]
Home ownership, low-income housing, mortgage insurance, housing policy, home equity insurance, rent insurance
National Category
Economics Civil Engineering
URN: urn:nbn:se:kth:diva-11236OAI: diva2:248800
QC 20100810Available from: 2009-10-09 Created: 2009-10-09 Last updated: 2010-11-30Bibliographically approved
In thesis
1. Essays on risk and housing
Open this publication in new window or tab >>Essays on risk and housing
2009 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

There is a series of different types of risk on the housing market and related industries.  The six papers in this doctoral dissertation are about a number of the many dimensions of risk management on the housing market. The main message of this thesis is that it should be possible for different actors in the housing market to improve risk management. Indeed, the last years’ financial turmoil has revealed that it should not only be possible, but also necessary, to improve risk management at all levels of the economy: at household, corporate, regional, national and international level. Although the complexity of the environment in which we live and act makes it very difficult to predict and quantify risk, the development of risk management techniques should make it possible to better indentify, and reduce risk.

The first paper provides a systematic overview of a wide selection of methods or strategies used in different countries to expand but also to maintain home ownership among low income households. The second paper further discusses mortgage and home equity insurance instruments discussed in the first paper. This paper also discusses how a rental insurance policy, as an alternative to traditional rent regulation, may be constructed. Paper 3 develops a formula that might be used in order to value the rental insurance option discussed in paper 2. The fourth paper focuses on the housing building sector by discussing potential benefits of strategic alliances that the different actors in the housing construction market may establish in order to pool resources and manage development risks. The challenge of constructing reliable home price indexes has attracted scholars for many years. Paper 5 develops monthly quality-adjusted price indexes for condominiums (housing cooperative apartments) based on a unique dataset covering sales in the whole of Stockholm municipality from January 2005 to June 2009. Finally paper 6 pays attention to the large increase in housing cooperative conversions sine the 1990s, by deriving a closed-form valuation formula that might be used to value the embedded option an owner of a multi-family rental property has to sell it to a housing cooperative.

Place, publisher, year, edition, pages
Stockholm: KTH, 2009. xv p.
Trita-BFE, ISSN 1104-4101 ; 2009 : 87
housing risks, risk management, strategic alliances, housing construction, low-income housing, real options, tenure choice, rent regulation, housing cooperative conversion, price index
National Category
Economics Economics Economic Geography
urn:nbn:se:kth:diva-11233 (URN)978-91-977302-4-2 (ISBN)
Public defence
2009-10-28, V2, Teknikringen 76, KTH, Stockholm, 13:00 (English)
QC 20100810Available from: 2009-10-08 Created: 2009-10-07 Last updated: 2010-08-10Bibliographically approved
2. Risk management of the housing market: with a focus on low income households
Open this publication in new window or tab >>Risk management of the housing market: with a focus on low income households
2005 (English)Licentiate thesis, comprehensive summary (Other scientific)
Place, publisher, year, edition, pages
Stockholm: KTH, 2005. iv p.
Trita-BFE, ISSN 1104-4101 ; 05:67
National Category
Other Mechanical Engineering
urn:nbn:se:kth:diva-398 (URN)91-975358-5-0 (ISBN)
QC 20101130Available from: 2005-08-16 Created: 2005-08-16 Last updated: 2010-11-30Bibliographically approved

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