BUSINESS

U.S. Foreclosure Crisis Linked To Diminished Health, Study Finds

09/02/2011 11:40 am 11:40:26 | Updated Nov 02, 2011

As the number of foreclosed homes continue to pile up, and as housing prices remain depressed, the personal health of those affected could cause for concern.

The damaging mental-health effects of the fragile economy have been a subject of study since the throes of the Great Recession, and with the economy now settling into a state of near-inertia, those same health consequences appear likely to continue to afflict Americans who view their financial position as precarious.

Of particular concern is the foreclosure crisis, which has already been linked to a wave of major depression and is believed to exacerbate compulsive behaviors like alcoholism and gambling. Now, increases in foreclosure activity appear to correlate with an uptick in hypertension, anxiety, diabetes and suicide attempts, according to researchers at Princeton and Georgia State University.

As the Wall Street Journal notes, correlation doesn't necessarily imply causation, and it's possible that a common factor -- like insolvency -- underlies both the rise in regional foreclosures observed in the study and the rise in hospitalization rates for stress-related ailments in those same regions.

But if foreclosure rates can be taken as even a loose barometer of health concerns, it's likely that the spate of stress-related medical consequences will get worse before it gets better.

Though home foreclosures fell to a 44-month low in July, most analysts agree that foreclosure rates are likely to jump once the system finishes processing the backlog of existing cases. Homeowners who have entered foreclosure but haven't been forced to leave their houses, thanks to the backlog, could increasingly face eviction as the system catches up.

Foreclosures tend to inflict collateral damage on the local real estate market, as they often drive down the value of neighboring houses and leave those homeowners with fewer financial options. Sometimes those neighbors are pushed into foreclosure themselves.

Meanwhile, a growing body of evidence suggests that most Americans are feeling the strain of a sagging economy -- from the long-term unemployed, many of whom suffer from anxiety and depression, to the newly jobless, some of whose life spans are actually shortened by the stress of being laid off and searching for work, to the full-time employees whose workloads continue to grow as payrolls shrink.

This summer, Americans have been more worried about the economy than any other issue, according to numerous polls. Their concerns may have been exacerbated by a drawn-out political standoff in Washington over the federal debt ceiling, and by the threat and then the actuality of a national credit downgrade from Standard & Poor's.

The economy made virtually no progress in August as new jobs failed to materialize and the unemployment rate stayed stuck above 9 percent.

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