A 2018 study suggests that black renters pay higher prices than white renters for identical housing across all areas, both urban and rural.
The study, which was published in June of this year, was authored by economists Dirk Early of Southwestern University, Paul E. Carillo of George Washington University, and Edgar O. Olsen of the University of Virginia. One of the most shocking findings was that, in addition to higher rents for black residents overall, black tenants could expect to pay higher rents as the percentage of white people in a certain neighborhood increased.
Early, Carillo, and Olsen came to their conclusions after analyzing a vast set of housing data from the U.S. Department of Housing and Urban Development for the 50 largest metropolitan areas, in addition to other smaller metro areas, non-metro areas, and areas in which the percentage of racial segregation in housing was both higher and lower than the national average.
“[R]acial attitudes about dealing with, and living near, people of other races can lead to racial differences in the rents paid for identical housing in the same neighborhood and differences in racial premia across neighborhoods with different racial composition,” the study read. “Identical units in the same neighborhood will not have the same rent. Blacks might reasonably search less where they expect to face the most hostility from landlords and neighbors, and those who rent in these areas will typically end up in overpriced units.”
“Landlords with little or no aversion to dealing with blacks should work in predominantly black areas and landlords with the greatest aversion in predominantly white areas,” the authors continued. “A similar sorting across neighborhoods will occur for white tenants. As a result, the black rent premium is likely to be greatest in heavily white neighborhoods.”
While the economists conducting the study found that the average additional cost black tenants could be expected to pay in rent was around 2.5 percent in census block groups with similar characteristics, the cost of rent goes up by about a third of a percentage point for every ten percentage points of white people in a given neighborhood. According to one table in the study, black renters can pay as much as 3.5 percent more for housing in a neighborhood that is 65 to 70 percent white:
The authors heralded the data as “unusually rich” and the study as the first of its kind.
“Besides rents and demographic characteristics of the renter, the data contain detailed information about the features of the housing unit and its neighborhood, including the census block group of each unit. This data set is particularly well suited to revisiting an issue that has been studied for more than fifty years. It yields the first highly credible evidence on patterns of racial rent differences in recent times.”
Click here to view a PDF link of the study.
Carl Gibson is a politics contributor for Grit Post. His work has previously been published in The Guardian, The Washington Post, The Houston Chronicle, Al-Jazeera America, and NPR, among others. Follow him on Twitter @crgibs or send him an email at carl at gritpost dot com.