The Housing and Urban Development Department released a study last week, Discrimination in Metropolitan Housing Markets: Phase I, showing that housing discrimination nationwide against African-Americans and Hispanics seeking to buy a home is down more than 25 percent since 1989. For those seeking to rent a unit, housing discrimination against African-Americans is down 18 percent, but is unchanged for Hispanics.
"These results illustrate that we are making efforts but there is still work to be done," said Housing and Urban Development Secretary Mel Martinez. "Every American should have equal access to housing opportunities."
"The downward trend reflected in the study and a more targeted education and enforcement effort on our behalf will help us to achieve the president's goal of 5.5 million new minority homeowners by the end of the decade," Martinez said. "The increased homeownership rates for African-Americans and Hispanics in the third quarter of 2002 reflect that we are knocking down barriers and opening doors for more minorities."
The study is the most ambitious effort to date to measure the extent of housing discrimination in the United States against people because of their race or ethnicity. Conducted by The Urban Institute, this is the third nationwide effort sponsored by HUD to measure the amount of discrimination faced by minority home seekers. The previous studies were conducted in 1977 and 1989.
HUD will use the research to document the nation's progress in reducing housing discrimination and to better target education and enforcement resources.
The study used a technique called "paired testing" to measure the level of housing discrimination. Paired testing matches two individuals, one minority and the other white non-Hispanic, and assigns them otherwise nearly identical characteristics. They both respond to the same advertisement within a short time of one another and independently record their experiences.
Analysts then compare those experiences with determine which tester received adverse treatment on different treatment variables. Treatment variables are the various opportunities agents have to behave differently toward the paired testers.
For example, each tester asks about the same advertised unit. If the unit is available to one and not the other, that test is recorded as showing adverse treatment toward the tester for whom the unit was not available.
The results, based on 4,600 paired tests, show that between 1989 and 2000:
Renters: Discrimination against blacks has declined to 22 percent, down from 26 percent, but discrimination against Hispanics has stayed about the same at about 25 percent.
Home sales: Discrimination against blacks has declined to 17 percent, down from 29 percent, and has declined for Hispanic homebuyers to 20 percent, down from 27 percent.
Overall, Hispanic renters are more likely than African-Americans to experience discrimination in their housing search.
Some types of adverse treatment toward minorities are more prevalent than others depending on the type of transaction and the race or ethnicity being tested:
Black renters - housing availability and inspections
Hispanic renters - housing availability, inspections and encouragement
Black buyers - inspections, steering, financing help and encouragement
Hispanic buyers - steering and financing help
"Housing availability" refers to whether a tester is told that an advertised unit, or something comparable, is available to the tester. For example, a minority tester might be told, "sorry, we just rented the last one" when a white tester is told "yes."
"Inspections" refers to whether a tester was actually able to see the advertised unit or similar units or homes. This factor also includes a comparison between testers of the number of units they actually see.
"Encouragement" refers to the way the rental or sales agent encouraged or helped the tester to complete the transaction, including inviting the tester to complete an application or arrange for future meetings.
"Steering" occurs when one tester is recommended or shown units located in neighborhoods that are more white than the other tester.
"Financing help" pertains to the level of information and assistance with mortgage financing from the real estate agent the tester visited.
Although rates of adverse treatment are down on most measures for African-American and Hispanic homebuyers, there are worrisome upward trends of adverse treatment in the areas of geographic steering for African-Americans and, relative to non-Hispanic whites, the amount of help agents provide to Hispanics with obtaining financing. On the rental side, Hispanics are more likely in 2000 than in 1989 to be quoted a higher rent than their white counterpart for the same unit.
The study measures the level of Hispanic or black housing discrimination vs. the treatment of white testers in 20 metropolitan housing markets:
Black and Hispanic testing: Austin, Texas; Chicago; Denver; Houston, Los Angeles; New York
Hispanic testing only: Pueblo, Colo.; San Antonio; San Diego; Tucson, Ariz.
Black testing only: Atlanta; Birmingham, Ala.; Dayton-Springfield, Ohio; Detroit; Macon, Ga.; New Orleans; Orlando, Fla.; Philadelphia, Pittsburgh, Washington
These results show that most metropolitan areas experience housing discrimination at or near the national level. However, for black/white tests, the overall incidence of consistent white-favored treatment for renters was higher than the national average in Atlanta, and significantly lower than the average in Chicago and Detroit. In sales, discrimination was higher than the national average in Austin, Texas. and Birmingham, Ala.; and significantly lower in Atlanta and Macon, Ga.
For Hispanic/non-Hispanic white tests, the incidence of consistent white-favored treatment for renters was lower than the national average in Denver. In sales, discrimination against Hispanic renters was above average in Austin and New York and below average in Pueblo and Tucson.