Economists have found another area of people’s lives affected by the collapse of the housing market and its seemingly never-ending foreclosures: Their physical health. Two economists, in a paper published by the National Bureau of Economic Research, have found a direct correlation between foreclosure rates and the overall health of residents in Florida, Arizona, California and New Jersey.
Their research indicated increasing foreclosures were correlated with a rise in emergency room visits and hospitalizations for hypertension and diabetes in people aged 20-49. Foreclosure increases were also associated with the rate of hospitalizations and emergency room visits for anxiety and suicide attempts.
The study does not prove that foreclosures are directly causing the increase in hospitalizations or suicide attempts, as correlation does not prove causation, but it makes sense that the increased stress a foreclosure brings could result in a substantial deterioration in health. Much research has demonstrated that increased health problems can be related to, or brought on by, stress.
Since there was no correlation between high foreclosure rates and an increased incidence of cancer or elective surgeries, the economists concluded that those living in areas with high foreclosure rates are suffering from an increase in mostly stress-related illnesses.
Unfortunately, even more people could be affected as the housing market braces for another wave of foreclosures. The S&P/Case-Shiller home-price index came in 5.9 percent lower for the second quarter than for the same period a year earlier. Homeowners who are not behind on their payments are still affected by foreclosures, of course. Neighbors of foreclosed properties are faced with another drop in home values.
Source: Wall Street Journal, “Tying Health Problems to Rise in Home Foreclosures,” Mitra Kalita, Aug. 31, 2011