1. Introduction

Subjective well-being (SWB) is individuals' perceptions of their overall happiness (Diener, 1984). Derived from the psychological field, SWB was extensively studied in terms of its determinants, namely what factors help produce people's sense of happiness. Common factors associated with SWB  include cultural  background, economic and political status, personal characteristics, physical conditions, etc.

(Zheng, Yuan and Zhang, 2020). Housing, as one aspect of individuals' social and economic status, is also found to be related to SWB  (e.g.,  Diaz-Serrano, 2009;

Zhang and Zhang, 2019; Lou, Du and Qiao, 2023). For example, children's health and education, as factors affecting SWB, are strongly related to housing conditions (Leventhal and Newman, 2010; Wen, Xiao and Zhang, 2017). However, the amount of research drawing specifically on housing and SWB is relatively sparse, while most of them focused on housing price (e.g., Florida, Mellander and Rentfrow, 2013; Zhang and Zhang, 2019; Pan et al., 2023) and ownership (e.g., Diaz-Serrano, 2009; Zheng, Yuan and Zhang, 2020). Inspired by literature on SWB in relation to the living environment and financial status (Dolan, Peasgood and White, 2008), there are other aspects of  housing status that  may  play a  role  in  people's  life satisfaction  but  are  rarely  studied,  such  as  housing  environment  and  debt conditions. While given that  housing  is  essential to  both  individuals'  lives  and socio-economic development, it is worth knowing more about how housing and people's happiness interact. Therefore, the present study aims to explore how two specific aspects of housing status, i.e., housing environment and housing debt, influence individuals' subjective well-being.

To demonstrate the theoretical and empirical basis for this research, this paper will  review  current  literature  regarding  subjective  well-being  and  housing  and identify possible research gaps. Specifically, this literature review contains three main parts. Firstly, a basic conceptualisation of SWB as an academic term will be given, introducing its definition, common determinants, and its relation to housing.

Secondly, research on the environment as one factor associated with SWB will be synthesised, followed by a narrowing down to the housing environment and SWB.

The paper will then look at previous studies on homeownership and SWB and move on to point out housing debt as a less-studied potential factor influencing SWB. Finally, an overall evaluation of current research on SWB and housing will be given, together with a possible research plan.

2. Subjective Well-being

2.1 Definition

Subjective   well-being,   namely    'happiness',   can   be    understood   from   both psychological  and  economic  perspectives.  Derived  from  studies  in  psychology, SWB  is  conceptualised  as  individuals'  self-assessment  of  their  happiness  and satisfaction in life (Diener, 1984). According to Diener's (1984) initial work about SWB,  the  term  encompasses  three   parts,  including  external  criteria,   leading factors to evaluating their lives in positive terms, and aspects of a person's life (p. 543). Combined with numerous later literature (e.g., Diener, Lucas and Oishi, 2002;

Diener,  Oishi  and  Tay,  2018),  the  three  components  defining  SWB  can  be understood as follows. External criteria refer to the external standards attributing to happiness, such as income, rather than one's internal perceptions. In contrast to  external  criteria,  the  second  component  can  be  understood  as  one's  own positive feelings in life, such as satisfaction and fulfilment. Thirdly, aspects of a person's life stress that SWB concerns with pleasant emotions one experiences every day. In the field of economics, SWB or happiness is used to evaluate the effectiveness of policies and economic growth, known as happiness economics.

The measurement of people's SWB cannot only help design and optimise policies for better socio-economic development (Frey and Stutzer, 2011; Murray, 2013) but also serve to predict a country's economic growth (Kenny, 1999; Easterlin, 2013).

2.2 Common Determinants

Numerous determinants of subjective well-being were found in previous research.

Health, in both psychological and physical senses, is one of the most significant determinants of SWB. Given the psychological nature of the notion, SWB is closely related to mental health. For example, Gargiulo and Stokes (2008) have found that the  loss  of  SWB  could  suggest  clinical  depression.  As  for  the  physical  aspect, specific health conditions, such as strokes, heart disease (Shields and Price, 2005), and disability (Uppal, 2006), are all related to individuals' perceptions of subjective well-being. In addition, education is another vital determinant of happiness that is generally recognised. According to early research from Cantril and Campbell (1982), 44% of students who graduated from college were very happy, but only 23% of those without a high school degree were very satisfied with their lives.

Instead of the effect of education on SWB being diminished, its influence becomes stronger (Nikolaev, 2016). He noted that people with higher education tend to consider their  lives  more  meaningful  and  less  negative  emotions.  Apart  from health and education, many other determinants of SWB were comprehensively studied, including age, gender, ethnicity, interpersonal relationships, etc. (Dolan, Peasgood and White, 2008). Fewer studies, however, were found to examine SWB in relation to housing conditions (Zhang and Zhang, 2019).

2.3 Subjective well-being, income and housing

As  research on SWB develops, income  is now  known as another crucial factor influencing one's sense of SWB. In the early period, scholars generally held the view that income had little influence on happiness. For example, Beveridge et al., (1976) found that an individual's income cannot significantly influence people's happiness.  Similarly,  according  to  Jacobs  and  Green   (1998),  when  the   rapid expansion happened in the middle of the twentieth century in the United States, workers gained much more money than before. However, there was little evidence here to prove they were happier than before. In general, most of the early studies based  on  the  time  series  data  tend  to  conclude  that  income  is  not  strongly correlated to subjective well-being. However, although there was much apparent unanimity, it is a common fact that rich people seem to enjoy more happiness than poor  people.  Numerous  later  empirical  investigations  can  prove  that  affluent people tend to have a higher rate of satisfaction with their lives than people who are  much  poorer.  Later studies  using cross-sectional empirical data  noted that income is, in fact, correlated to happiness. According to Diener et al. (1999), the correlation  between  income  and  subjective  well-being  is  more  significant  for people in the same country. The few micro-level  panel studies that follow the same individuals over time have reported a positive correlation between income and   subjective    well-being   (Ferrer-i-Carbonell,    2005).    From   the    economic perspective, in the utility function theory, where consumption always makes a positive impact,  people enjoy  much  more with other conditions constant, and increasement occurs in the goods they can obtain. Moreover, Lane (2000) stated that once the external resources supply is under the appropriate range, happiness and satisfaction can  be  bought with  money. Thus,  income  does  have  a  strong relevance to the SWB. While given that homeownership is associated with income (Lefebvre, 2002), it is possible that housing interacts with people's happiness as well.

3. Environment

3.1 Environment and subjective well-being

Existing  research  has  suggested  that  environmental  conditions  are  potentially related to  housing  prices and subjective well-being.  Popular  in economics  and psychology, the  hedonic  model  is  a  conceptual  framework  that  explains  how decisions are made based on the pursuit of pleasure and avoidance of pain. In recent years, many scholars have advocated this method in asset pricing (Sirmans, Macpherson and Zietz, 2005; Chau and Chin, 2012). For instance, Jim and Chen (2006) noted the impact of environmental externalities on house prices in the hedonic  model.  Besides  the  price  affected  by  the  environment,  SWB  is  also associated with the environment. According to Diener, Oishi, and Tay (2018), the environment  may  influence  people's  evaluation  of  how  happy  their  lives  are.

Specifically, a healthier environment is correlated to a higher level of SWB (Diener, Oishi and Tay, 2018, p. 255). Additionally, cleaner air tends to result in higher SWB (Luechinger, 2009).

3.2 Housing environment and subjective well-being

Since   evidence   suggests   that    housing   price   and   SWB   vary   according   to environmental factors, it is possible that the housing environment, as a specific kind of environmental variable, is also related to SWB. However, although there are   studies   focusing   on   the   health   and   psychological   aspects   of   housing environments (Wright and Kloos, 2007; Bonnefoy, 2007), its relationship with SWB from an economic perspective still needs to be explored. To study the relationship between housing environment and SWB, two dimensions of housing environment will be considered. One is the actual housing conditions, namely people's living space. Living environment can significantly differ in the range of regions, house qualities, etc. (Rehdanz and Maddison, 2008). Another factor is the environment of relationships, which makes a difference in a more intangible way (Unger and Wandersman, 1985). In the following part, both of the environmental factors will be introduced.

Taniguchi  and  Potter  (2015)  noted  that  friendly   and   positive  relations  with neighbours  positively  affect  people's  SWB.  Neighborhood  provides  a  platform where individuals can participate in a series of social interactions, and the support can be tangible or intangible (Unger and Wandersman,  1985).  In their studies, people can receive both material support (e.g. food, fixing tools) and emotional support  (e.g.   marital  conflict   mediation)  from  their   neighbours.  They  also mentioned  that  assistance  from  neighbours  sometimes   is  prompt  and   more credible than what relatives can do. Meanwhile, even though people have not received actual help from neighbours, their level of SWB can be increased through everyday interactions. Yu et al. (2020) indicated that close daily interaction and information  exchange  help  alleviate  anxious  and  fretful  feelings  and  improve satisfaction in mental. The various interpersonal environments provided are hard to evaluate by money appearing in the house price.

4. House Ownership

4.1 House Ownership and Subjective Well-being

Previous studies examining housing in relation to SWB focus more on the pricing aspect. In research of Pan et al (2023), the ordinary least squares (OLS) have been applied to identify the association between the housing price and SWB. In the regression model, SWB is the dependent variable in the OLS model, and the House prices (natural log) present a significant coefficient of -0.034 (SE=0.013), and the constant value is 3.494 (SE=0.13). The authors also added the IV Land supply per capita into this regression. The IV estimated that the level of SWB would be lower as the  land supply increased, which  led to the  increase in  house prices in the previous year. In summary, they found the negative impact of house price on the SWB. However, their study merely focused on the effect of housing price but did not consider the debt and ownership status.

In Diaz-Serrano's (2009) research, it was noted that the homeownership change can bring about changes in one's life satisfaction. In the regression, Diaz-Serrano analysed the data transition from renter to homeowner. His measurement of SWB is on a scale of 1 to 6 from low to high level. The results firstly show that house owners tend to be happier than renters, where homeowners tend to be clustered at the higher level of the satisfaction scale (Level 5 and 6), while renters are more represented  at  the   lower  end  (Level   1  to  3).  Specifically,  37.30%  of  owners reported level-5 happiness, which is a higher percentage compared to 30.07% of renters (Diaz-Serrano, 2009, p. 751). Secondly, according to Diaz-Serrano's (2009, p. 751) findings of the homeownership transition, there is a general increase in SWB  level  for  people  (both  stayers  and  movers)  who  turned  from  tenants  to owners. In other words, the transfer of homeownership from renting to owning contributes to improving individuals' SWB, which is no less important than the impact of  house  price  on  SWB.  In  brief,  Diaz-Serrano's  research  indicated  the potential that homeownership is related to SWB.  However, while  Diaz-Serrano only  concentrated  on  the  transition  of  home  property  status  from  renting  to owning, the status of ownership can be more complex in real life. For example, there are situations where people own a house but have a mortgage. Therefore, drawing    from    and     complementing     previous    knowledge     of    SWB     and homeownership, the  present study aims to  examine the  relationship  between housing debt and SWB in detail.

4.2 Housing Debt and Subjective Well-being

On the one hand, there is evidence suggesting a positive impact of holding housing debt on  people's  SWB.  Firstly,  financially  speaking,  mortgage  can  help  people maintain enough cash flow to increase their utility and avoid risks. According to the Liquidity Constraint Theory, borrowing can help people out of consumption dilemmas  when  facing  a   liquidity  constraint,  such  as  purchasing  a  house.

Meanwhile, mortgage is considered as a method of hedging against risks to avoid uncertain rent volatility, where lenders can make fixed mortgage payments, i.e., stable   repayments   (Goodman   and   Mayer,   2018).   In   both   senses,   people's satisfaction with their economic status would be increased, levelling up the sense of SWB (Lou, Du and Qiao, 2023). Secondly, in terms of the relationship between indebtedness  and  health  status,  scholars  have  found  that  mortgages  can  be associated with better health situations. Although Nettleton and Burrows (1998) have noted that people under housing insecurity, especially those with mortgages, would have worse health conditions, some recent studies have drawn different conclusions. For example, Loibl et al. (2020) found that the house mortgage does not have a significant influence on older people's mental health compared with unsecured financial debts. Instead, Cairney and Boyle (2004) noted that people who take a mortgage could afford more medical insurance than those who make full payments on the house. In brief, more cash in hand could make people feel more confident about their health status, which can lead to a higher level of SWB (Dolan, Peasgood and White, 2008). Thirdly, in the longer term, once a significant portion  of  the   mortgage  was  paid  off,  homeowners'  sense  of  stability  and achievement would increase, which could positively influence their SWB. Tay et al.

(2016) noted that individuals' SWB is lower when they maintain a more significant amount of mortgage loans, while after repaying most of the loans, people would experience  higher  overall  life  satisfaction  with  their  permanent  residence  and equity accumulation.

On the other hand, housing mortgages can be related to a lower sense of SWB in certain  circumstances.  Firstly,  Ellaway  and  Macintyre   (1998)  have  noted  that people with subsidies in debt usually have worse social circumstances, and their houses tend to be of lower quality. Secondly, for  low-income  households who cannot  pay  for  the  whole   house  and   are  forced  to  take  the   loan,   housing mortgages  can  turn  into  foreclosures  and  predatory  mortgage  lending,  which could  lead  to  turbulence  in  lives  and  reduce  SWB.  (Barnes  and  Jaret,  2003).

To address this research question, the researcher plans to design a survey with a scale to measure people's SWB and relevant questions about their housing status.

Since most of the research on housing and SWB is contextualised in China, where there is a unique housing loan system (i.e., housing provident fund system, Yeung and Howes, 2006), the current study is interested in housing situations and SWB in great economies with well-established real estate transaction system in Europe.

Thus, the survey will be distributed to countries including Germany, France, Italy, and The United Kingdom. For the data analysis part, ordinary least squares (OLS)

will be adopted, drawing from research on association with SWB and housing price from  Pan  et  al.  (2023).  In  addition,  many  studies  indicated  the  complexity  in associations with SWB and housing, where endogenies may cause inconclusive results  (Liang,  Lu  and  Zhang,  2016;  Prakash  and  Smyth,  2019).  Therefore, introducing the instrument variable (IV) is necessary for the analysis. Following a previous study (Galster and Lee, 2020), housing supply in the past affects current housing   market    dynamics,   including   availability    and   affordability,   thereby influencing  individuals'  housing  choices  and  mortgage  burdens.  The  historical housing supply can be chosen as IV, given that it influences mortgage conditions but does not have a direct effect on SWB. However, this study is still limited, given that there are still other aspects in housing that might affect one's SWB but are not included due to the difficulty in measuring, such as housing maintenance fees, housing   insurances   (for   earthquake,   flood,   etc.),    real   estate   transfer   and inheritance tax.