Rising Energy Costs Lead to Mortgage
Delinquency?
Rising energy prices can raise
mortgage delinquency rates, according to a new study in Energy Economics, “Do
household energy expenditures affect mortgage delinquency
rates?”

After all, rising utility costs
can constrain home owners’ budgets, researchers from Boston University note. In
fact, researchers found the rise in energy prices were connected to the 2008
financial crisis.

The researchers
analyzed the percentage of U.S. mortgages that are 30 to 89 days past due and
those that entered foreclosure, rates of home ownership, home prices, as well as
the cost of household expenses on energy prices.

Researchers R.K. Kaufmann, as well as colleagues, from Boston
University concluded: “Together, these variables account for much of the
historical variation in the percentage of U.S. mortgages that are 30 to 89 days
past due and indicate that the post 2006 rise in this measure of mortgage
delinquency is associated with falling home prices, an increase in household
expenditures on energy, and rising unemployment.”

Source: “Energy Economics: Research From Boston
University Has Provided New Information About Energy
Economics,”
Investment Weekly News
(May 7, 2011) and
“Do Household Energy Expenditures Affect
Mortgage Delinquency Rates?”

ScienceDirect (March 2011)

Read
more:

Energy Efficiency and the ‘Home of the
Future’

Advertisements