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This Article Compares a Number of Research Studies to Determine Whether Racial Differences Affect Housing in America

Updated on February 20, 2020
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Patrick has been working as a freelance writer on fiverr for the past 2 years.

Racial differences and housing

Source

Does Race Matter in the Search for Housing? An Exploratory Study of Search Strategies, Experiences, and Locations (Krysan, M. 2009)


According to the researcher, racial segregation is still evident in many of the larger and older cities in places like Chicago, Newark, and New York among others. While levels of segregation have slightly fallen over the years, they are still evident. For this reason, the study was aimed at determining whether race has a role to play when it comes to searching for houses. Here, the researcher sought to find out whether strategies used to find houses vary between different races (African Americans and while) and whether different races have different experiences when doing so. According to several studies, the researcher found out that for African Americans, they are highly likely to be shown fewer units, were told that only a few units existed and in addition to being less likely called back, were generally poorly treated compared to white people looking for houses. The study, conducted in Detroit, found this to be true, but also found out that for a majority of African Americans, network with friends and families was the main source of information regarding renting houses in the area compared to 36 percent of white people.

Given that racial differences are part of cultural demographics; this study provides important information that would contribute to the current study. According to the study, it was evident that race is a determining factor of whether or not an individual can access and get given property (house). Given that African Americans were likely to be shown fewer units and even less likely to be called back, it becomes evident that in a given area, changes in cultural demographics will influence the type of people buying or renting and ultimately the prices of the houses available.

The Effects of Demographics on the Real Estate Market in the United States and China. Honors College, Pace University (Li, H. 2014)


In this paper, the researcher looks at the impact that demographic change can have on real estate and real estate laws in America and China. According to the researcher, both the United States and China continue to experience demographic changes both in their populations and the workforce. For instance, due to the rapidly growing population observed in the 1960s in China, the country enacted a one-child policy in the 1970s which reduced population growth while creating a rising economy. Like China, this had a positive impact on baby boomer generation in America given that there were sufficient resources, jobs, and income that they could use to buy property, etc. However, with these generations going into retirement, it appears to have a direct impact on house prices. A good example of this is with regard to the existence of what has come to be known as ghost towns in China that are too expensive for people to live in.

According to the results, the researcher notes that ultimately, it becomes evident that changes in the demographics have a direct or indirect impact on real estate. For instance, as the baby boomer generation goes into retirement, they will also look to sell their houses and property, which would increase supply. As a result, this would have a direct impact on prices due to many more homes being available in the market. On the other hand, high population growth can result in higher demand and thus a rise in price rates for homes. However, this may have the opposite impact given that it can result in high rates of unemployment and thus fewer people buying homes, which can cause the price of homes to drop. Ultimately, then, demographic changes will affect real estate. While the study does not touch on the shift in cultural demographics, it shows how changes in demographics, in general, can affect real estate. From the study, therefore, it is possible to predict the impact that immigration, and thus population change can have on real estate and real estate laws given that such a shift also means changes in the population.

Housing

Source

Immigration and the Neighborhood (Saiz, A., and Wachter, S. 2006)


According to the researchers, within many metropolitan areas, neighborhoods with immigrants tend to relatively grow slowly. For this reason, they sought to determine the impact that immigrants have on the dynamics of various neighborhoods. As they explain, an increase in the number of immigrants in a neighborhood was associated with lower housing price appreciation. However, Native Americans were also shown to be willing to spend more to live in areas with other Native Americans (Those born in America). On the other hand, the value was shown to be lower in areas where the number of immigrants was on the rise. From the findings, it was evident that with an increase in the number of immigrants in a given neighborhood, the value and prices of the houses were not likely to grow rapidly. However, given that native Americans (born in America) were willing to move to native areas and pay more, this suggests that in such neighborhoods, prices and value were likely to rise and immigrants (and thus racial minorities) were less likely to find houses in such neighborhoods.

The study tries to identify the relationship between immigrants and neighborhood dynamics. This is particularly important given that it shows how a shift in cultural demographics in a given neighborhood can cause changes of both the people living in the area and the value of houses in the area. As such, it shows the impact of cultural demographics on real estate and even on the laws in the field.

Neighborhood Quality and Housing Value: Evidence from Urban Micro Data (Wang, Y., Ran, R., and Deng, G. 2012)


In any given neighborhood, the value of houses is dependent on a number of factors such as occupational diversity. For this research study, the authors sought to determine the impacts that these factors have on the value of housing in neighborhoods. Here, the authors included such factors as the average of schooling years, occupation and ethnic diversity to determine their impacts on housing value.

While such factors as more schooling years were shown to have a positive impact on housing value, ethnic diversity was shown to present a negative impact on housing prices and thus value in various neighborhoods. This led the researchers to conclude that in such Chinese neighborhoods, there is a high preference for the national culture as well as possible ethnic discrimination. Given that there was a correlation between low housing prices and value and cultural differences in the neighborhoods included in the study, researchers concluded that there is a need to implement laws that conditions are improved in such neighborhoods in order to improve living conditions in such areas. According to the study, it becomes evident that even in countries like China, an increase in racial minorities, which causes cultural demographic changes in the neighborhood as a result of an increase in a given group of people, can result in the value of housing and prices going down. Consequently, this can have a negative impact on the people living in the neighborhood given that they may lack proper conditions that ensure a good quality of life.

Ethnic Residential Segregation and Its Consequences. Center for Demography and Ecology (Wilson, F. D., and Hammer. R. B. 1998)


In this study, the researcher worked on the idea that in the United States, there are residential preferences between different ethnicities. This is seen as not only have resulted in housing market discrimination but also negative impacts on some of the neighborhoods with given racial minorities. For this study, therefore, the researchers sought to not only determine preferences between the different ethnicities but also how this affects ethnic composition in the neighborhoods. According to the results, it was evident that there is a high preference for living in ethnically homogenous neighborhoods, which has, in turn, resulted in ethnic homogeny. For many racial minorities, however, there is a feeling that this leads to discrimination in that it becomes difficult to get better quality houses in neighborhoods with white Americans.

On the other hand, the researchers also found a positive relationship between ethnic homogeny and housing quality, and thus value and pricing. On the other hand, wealthy white individuals were also found to live together while wealthy individuals from racial minorities were shown to live in different neighborhoods, but away from those of their ethnic background.

This study identifies the segregation that exists between ethnic groups in the neighborhoods, but also those between the wealthy and those who are not well off. While wealthy white individuals were found to live in homogeny, this was not necessarily the case with those from racial minorities. However, of particular importance to the current study, the researchers identified the impacts of the changes in cultural demographics on real estate. Whereas neighborhoods with increasing racial minorities were shown to be of low value and lower prices, those with white homogeny were shown to be of higher value.

The housing issue

Source

This content is accurate and true to the best of the author’s knowledge and is not meant to substitute for formal and individualized advice from a qualified professional.

© 2020 Patrick

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