Racial discrimination alive in housing market

An industry study has revealed that racial bias is still prevalent in the housing market

Racial discrimination alive in housing market

Black homebuyers who contact agents about recently advertised homes for sale learn of about 17% fewer available homes than equally qualified whites and are shown 17.7% fewer homes, according to an industry study.

HUD’s Housing Discrimination against Racial and Ethnic Minorities study released yesterday also showed Asian homebuyers learn of about 15.5% fewer available homes than equally qualified whites and are shown 18.8% fewer homes. Though not the case for rentals, overall differences in treatment for Hispanic homebuyers are not statistically significant where home buying is concerned.

When homebuyers meet in person with housing providers, they are usually told about at least one available unit. However, agents frequently tell one tester about more available homes than the other, with whites significantly more likely to be favored than blacks and Asians, the study said.
Consequently, for every two visits, black and Asian homebuyers learn about one fewer home than equally qualified whites.

In one sales test, the black tester called and spoke with an agent who insisted that she must be prequalified in order to see homes. The agent refused to meet with the tester until she had talked to a lender. The white tester was not asked about prequalification over the phone and was able to make an appointment to meet with the agent.

More than 8,000 tests were conducted in a nationally representative sample of 28 metropolitan areas. In each test, two trained individuals—one white and the other black, Hispanic, or Asian—contacted a housing provider to inquire about a housing unit randomly selected from recently advertised homes and apartments. The two testers in each pair were matched on gender and age, and both presented themselves as equally and unambiguously well-qualified to rent or buy the advertised unit. Each tester independently recorded the treatment he or she experienced, including information about all the homes or apartments recommended and shown.