A new study says it shows that “giving up” on owning a home could significantly increase risky gambling behaviors.
The paper, published Nov. 19, 2025, by Seung Hyeong Lee (Northwestern University) and Younggeun Yoo (University of Chicago), provides empirical evidence of a link.
Financial precarity—in this case, long-term renting with uncertain prospects of ever owning a home—has long-lasting adverse effects. One of those effects could be making riskier bets.
“Households that give up shift toward living for the present—consuming more, working less, and sometimes gambling on high-risk assets,” the authors wrote. “For those priced out of the housing market, gambling on improbable but potentially transformative gains may appear rational, particularly among younger cohorts.”
The researchers looked specifically at cryptocurrency and “risky asset” stock gambling.
Housing Affordability and Gambling
Homeownership has become increasingly inaccessible for younger generations. As a result, many U.S. households are abandoning the goal of owning the place where they live.
In particular, researchers found that people with some wealth (e.g., recent college graduates) but not enough to guarantee future homeownership are the most likely to “gamble.”
From the paper:
“Our empirical evidence demonstrates that renters who no longer expect to become homeowners behave very differently from those still trying to buy a home. They spend more of their income today and are more likely to take on risky financial investments.
“These patterns appear both in cross-sectional comparisons and in empirical estimations that capture responses to local affordability changes. They suggest that losing the prospect of owning a home changes the way households think about the future, reducing the incentive to save or work toward long-term financial goals.
“Our life-cycle model helps explain why these behavioral shifts arise and how they accumulate over time. When homeownership becomes out of reach, the future rewards from working hard, saving aggressively, and taking careful investment risks shrink dramatically.”
Bigger Picture for Sports Betting
The study didn’t specifically examine sports betting, but home affordability could affect gambling on sports, which many Americans unfortunately see as a form of investment.
“Although we don’t directly examine online sports betting in the paper, participation in online betting is generally driven by two distinct motives,” paper author Younggeun Yoo told GamblingHarm.org. “The first is the desire to win and earn money that can be used for consumption, wealth building, or longer-term goals such as eventually purchasing a home. For individuals with this motive, the increased risk-taking behavior we document in the paper could plausibly extend to online sports betting as well.”
“The second common motive is the pure enjoyment or entertainment value of betting. While this is less directly related to the risk-taking channel we study, our paper also shows that people become less disciplined in their spending as homeownership becomes less affordable. If we think of entertainment-driven sports betting as a form of ‘consumption,’ then decreasing housing affordability could also contribute to greater participation in online betting.”
Dozens of states regulate traditional sports betting apps (e.g., DraftKings and FanDuel). At the same time, the federal Commodity Futures Trading Commission (CFTC) has effectively given the green light to so-called “prediction markets” (e.g., Kalshi and Robinhood) to facilitate sports gambling in the form of stock-style “trading.”
In November 2025, Bank of America warned that sports betting in both forms among low-income households and recent college graduates could put “pressure” on some lenders, including student-loan giant Sallie Mae.
“The negative financial impacts of sports betting are more pronounced for young men, especially in low-income areas,” BofA analysts said. “Easy access and gamified interfaces encourage frequent and impulsive wagers, which can lead to overextension of credit and rising loan defaults.”
Changing Sports Betting Attitudes
Adding to the concerns about reckless sports gambling was a Siena College poll released in early 2025 showing that 90% of online sports bettors aged 18-34 think they can make money by gambling. Other studies have shown a growth in gambling myths related to an overestimation of winning chances.
We also know that half of online bettors are experiencing issues or are addicted, according to a late 2025 study from Maryland. A 2024 paper already gave us a glimpse into the impact of legal sports betting on a state’s population. Residents of sports betting states have worse financial health, according to the credit panel study.
Surely some young people are turning to sports betting as part of their homeownership goals. Doing so could further diminish their chances of ever owning a home.
Discover more from GamblingHarm.org
Subscribe to get the latest posts sent to your email.
