English 101

How Continued Housing Discrimination Is Perpetuating The Racial Wealth Gap in America

ANSWER

How Continued Housing Discrimination Is Perpetuating the Racial Wealth Gap in America

Introduction

Discrimination in general has continued to undermine the life chances of the minorities through lowering their access to socioeconomic opportunities. In the United States, housing discrimination refers to the illegal practice of denying equal access or a fair opportunity to housing for reasons such as race, disability, national origin, religion, sex/gender and household status (Logan, 2013). Despite the passage of this federal law, housing discrimination continues to be a major problem in America. In this paper, I will describe the key findings of research into how continued housing discrimination is perpetuating the racial wealth gap in America as areas of common agreement.

Housing discrimination has continued to be a great problem in America for more than half a century since the Fair Housing Act was established. The federal Fair Housing Act makes it illegal for a person or organization to discriminate in the financing, rental, or sale of housing on the basis of color, race sex, religion, state origin, household status and disability. The law protects all people equally, regardless of their skin color or ethnicity.

One unfortunate consequence of housing discrimination is that it has helped to perpetuate the racial wealth gap in America.  This wealth gap has persisted for decades, and it’s getting worse. Between 1983 and 2013, the average white family’s wealth increased while the average black family’s wealth decreased. There are many factors that contribute to the racial wealth gap, but housing discrimination is one of the most important.

Housing discrimination can take many different forms, but some of the most common include denying or delaying access to housing, charging different prices or rents for housing, offering different terms or conditions for housing on the basis of ethnicity, race or state origin, refusing to sell or rent housing to certain groups of people (Logan, 2013). All of these practices have the effect of excluding people from the mainstream housing market, which in turn limits their ability to accumulate wealth. For example, if a black family is constantly denied access to quality housing, they will be forced to live in poorer neighborhoods with lower-quality schools and fewer job opportunities. This will make it much more difficult for them to achieve financial stability and accumulate wealth over time.

Review of Literature

The Rise of Residential Segregation

Discrimination in housing occurs when qualified people are differently treated due to their membership in a certain group. This has occurred in the form of ethnic and racial discrimination both leading to personal prejudice in the housing market. With the adverse links of housing discrimination with racial wealth gap, studies show that residential segregation is a powerful predictor of wealth gap in America. Residential segregation arises from ethnic segregation on white and black income disparity.

Thomas and Moye (2015) focused on the influence of residential segregation as well as social status on racial variations in wages for women and men. The study findings clearly indicate that the earning variations between African-American remain despite the controls for gender, socioeconomic status among other control variables. The study is relevant since it found that segregation is high due to the disparity between the white and African American due to racial difference in social class status.

Shapiro, Meschede and Osoro (2013) also supports that wealth disparity has been a debate in America over the years. Therefore, the report focuses on exploring the origins of the increasing ethnic wealth variance, enlightening the black-white financial division. The report offers critical information on what is fueling the racial wealth gap and also focuses on policy approaches that can lead to a more prosperous and equitable direction of the country. The key findings of the report is that the total wealth gap among the African-Americans as well as white families nearly triples. The report supports that residential segregation leads to inequity since the whites have a high homeownership rates due to the historic differences in access to credit, lower incomes and family financial assistance. For instance, the whites have large up-front payments, low interest rates as well as low lending costs which increase the homeownership rates among the whites. The report is relevant to the study since it offers evidence on the impact of housing and homeownership to the increased racial wealth gap in America. The historic differences in residential segregation have continued to influence the increasing racial wealth gap.

Rothwell and Massey (2010) states that socioeconomic segregation has increased considerably in the U.S cities. The study evaluated the economic segregation through Gini coefficient to determine poor affluent exposure index and neighborhood income inequality. The findings of the study are relevant since they indicate that zoning is linked to greater inter-jurisdictional inequality. The suburbs in the metropolitan areas have restricted residential construction on the basis of segregated income.

According to Thomas et al., (2018), the impacts of class, race and housing segregation on residential values has continued to be a great focuses in sociological research. The purpose of the study was to measure the level to which the great recession influence the housing prices of the whites and African Americans comparative to residential segregation and impacts of class and race. The study relied on quantitative data collected from the Integrated Public Use Micro-data series which revealed that the great recession has led to high racial differences in housing values. Considerably, there are significant racial difference in the ownership constituents such as home equity. The study offers substantial evidence that numerous factors influencing racial difference in the home value. One of the greatest aspects that have influenced the ethnic wealth gap is the difference in the price of homes possessed by the African Americans and the whites. The study shows that there are three factors that influence the racial wealth gap between which include the great recession, socioeconomic status and the residential segregation. The study has clearly shown that the residential segregation has negatively impacted the housing values of the minorities such as the African Americans.

Popescu, Duffy, Mendelsohn and Escarce (2018) evaluated the association between housing segregation and the white-black survival variation as well as the degree to which socioeconomic disparity links to the association. A cross-sectional research of Black and White women and men aged between 35 and 75 who were used in measuring segregation. The cross-sectional study clearly indicated that residential segregation is linked to the white-black survival gap.

Williams (2017) focused on a study on financial stratification to examine the link between wealth opportunity and the ethnic wealth gap. The study investigated the degree to which cultural variations explain racial wealth variation. The findings of the study are pertinent since indicated that wealth is easily transferred from one generation to another which supports that household wealth plays a great role in economic stratification and functions to support the racial wealth gap.

Housing Market

Housing discrimination in the housing market is prevalent and has greatly impacted the racial wealth disparity. Persons of color are discriminated against in nearly every aspect of the home-buying process. In addition, black and Latino homeowners earn significantly less than their white counterparts, even when they have the same qualifications. This issue is illustrated by the fact that Latino and Black families are probably to rent than white households.

Korver-Glenn (2018) focused on a housing market case study which examined how racial stereotypes have linked the consecutively linked phases of housing exchange process. The researcher focused on the extent and manner in which racial discrimination of pertinent stakeholders in the housing market have influenced the sales of home and property ownership among the people of color. The study theorized the city of Houston, Texas which was an appropriate location to examine the research question due to its minimum housing regulations and housing background.

Korver-Glenn (2018) relied on ethnographic research and 100 in-depth interviews in Houston housing market. The results of the study indicated that there is a widely shared hierarchical racial stereotype sustained by settings such as discretion, network imposed rapport building and multiple discriminations within the distinct phases of housing exchange. The article was relevant for the study since it focuses on a specific case study on a specific city to confirm that racial stereotypes and housing discrimination influence the housing exchange.

Markley et al., (2020) focused on the confines of homeownership which included ethnic capitalism, appreciation gap and Black prosperity. The study was carried out to measure the rise in the Black homeownership as a way of narrowing the wealth gap. The study successfully contribute to the study of homeownership where racial appreciation gap was theorized since it’s a vital feature in the urban housing markets. The study also analyzed how the income characteristics and neighborhood racial have contributed to the home price appreciation. The study relied on two counties in USA, Georgia and Atlanta. These were effective for the study since they recognized for Black Prosperity. The study indicated that the neighborhood structure has a significant influence on home value change as compared to incomes. For instance, when a place is identified as Black resident, there are limitations in the home price appreciation which leads to the enduring racial wealth disparity contributed by the home appreciation gap. Therefore, the study suggests that the potential racial appreciation gap has greatly led to the racial wealth disparity. This study was relevant since it focuses on the limits of homeownership which have greatly led to the racial wealth gap in America.

Sharp, Whitehead and Hall (2020) focused on the part of extra household kin in structuring the racial disparities which increase loss of house ownership. Considerably, previous research has shown that extra household kin economic resources led has contributed to racial disparity in shifts into homeownership but how the resources influence racial disparities in how ownership has been less understood. Therefore, the study focused on a longitudinal data that was obtained from a Panel Study of Income Dynamics.

Sharp, Whitehead and Hall (2020) have offered a new proof on kin resources, race and the risk of shifting from buying to leasing. The study was mixed method qualitative study that was conducted among the black and white home owners. The study method and findings were relevant since they indicate that the black homeowners are highly disadvantaged due to housing discrimination which increases their probability of losing homeownership. The findings are relevant to this study since they show the likelihood of losing homeownership among the Blacks as compared to the Whites which greatly influences racial wealth gap.

Aliprantis and Carroll (2019) state that most studies have focused on the persistent disparity in wealth among blacks and whites through investigating the huge income disparity between the incomes earned by both groups. Therefore, Aliprantis and Carroll (2019) studied the issue in an altered style through taking the dynamics of wealth amassing over time. The study found out that the income disparity is the main reason behind wealth disparity and explains the persistent variation in wealth accumulation. The study relied on a mixed-method research that relied on the Panel Study of Income Dynamics which compared the main contributors of wealth gap over time. The research found out that racial income gap is the main contributor for wealth gap and the reason for the persistent variation in the average wealth between the white and black households. These findings are relevant to the study since they indicate that the racial labor income have greatly contributed to the persistent racial wealth gap.

Bayer, Casey, Ferreira and McMillan (2017) focused on whether minorities pay more as compared to the whites in similar housing. The research reviewed an important question using a distinct fata set that covered two million repeat sales housing transactions that were drawn from different metropolitan areas. The findings of the study indicated that the black families tend to pay more for housing as compared to the white buyers. The findings have implications for the perseverance of racial variances in segregation, home ownership and changing aspects of wealth amassing. Auspurg, Schneck and Hinz (2019) offered a quantitative meta-analysis of field experiments in correspondents’ tests and in person audits that were run to offer evidence for ethnic discrimination in housing. The findings of the study are significant since they indicated that a discriminatory behavior in the housing market.

In summation, the literature review has focused on the continued housing discrimination that contributes to the perpetuating racial wealth gap. The two major themes identified in the study include racial residential segregation and housing market discrimination and their contribution in racial wealth gap in America. The various studies have shown that housing discrimination is prevalent in America and leads to homeownership variations among the Blacks, Latinos and White. The colored people have encountered housing discrimination which leads to continued racial wealth gap

Methodology

To answer the research question on housing discrimination perpetuating racial wealth gap, mixed method research would most appropriate. The mixed method research involve both qualitative and quantitative research methods which would allow for a comprehensive understanding on the housing discrimination experienced by people of color. The qualitative research would provide in-depth understanding on the experiences and perceptions of housing discrimination while the quantitative research would offer statistical proof on the prevalence of residential discrimination. This combination of study methods would allow for a more complete understanding on how housing discrimination plays a role in perpetuating racial wealth gap.

The purposive sample would be a good way to find participants for this research. Participants of the research will be people who have experienced housing discrimination in their private rental or purchase transactions. This sampling method is purposive because the sample size is purposely limited and each participant will provide a unique perspective on his/her experience with housing discrimination.

The interviews, which would be done through either phone or in-person, will be a good way to collect the qualitative data from the participants. The interviews would allow for probing and clarifying questions that will provide data on how housing discrimination has played out in his/her specific situation. In addition, the interviews allow for a more open conversation between me and participant about their experiences so that they can provide more details that may not have been captured from the survey.

The survey would be a good way to collect quantitative data from participants as well as assess if there have been changes in housing market. The study design for this exploration would be a combination of qualitative and quantitative approaches. The mixed method design will allow me to assess both participants’ experiences with housing discrimination, as well as any changes in the housing market and how they have influenced the racial wealth disparity.

References

Aliprantis, D., & Carroll, D. R. (2019). What Is Behind the Persistence of the Racial Wealth Gap? In Economic Commentary (Federal Reserve Bank of Cleveland) (pp. 1–6). Federal Reserve Bank of Cleveland. https://doi.org/10.26509/frbc-ec-201903

Auspurg, K., Schneck, A., & Hinz, T. (2019). Closed doors everywhere? A meta-analysis of field experiments on ethnic discrimination in rental housing markets. Journal of Ethnic and Migration Studies, 45(1), 95-114. https://doi.org/10.1080/1369183X.2018.1489223

Bayer, P., Casey, M., Ferreira, F., & McMillan, R. (2017). Racial and ethnic price differentials in the housing market. In Journal of Urban Economics (Vol. 102, pp. 91–105). Elsevier BV. https://doi.org/10.1016/j.jue.2017.07.004

Korver-Glenn, E. (2018). Compounding inequalities: How racial stereotypes and discrimination accumulate across the stages of housing exchange. American Sociological Review, 83(4), 627-656. https://doi.org/10.1177/0003122418781774

Logan, J. R. (2013). The Persistence of Segregation in the 21st Century Metropolis. In City & Community (Vol. 12, Issue 2, pp. 160–168). SAGE Publications. https://doi.org/10.1111/cico.12021

Markley, S. N., Hafley, T. J., Allums, C. A., Holloway, S. R., & Chung, H. C. (2020). The Limits of Homeownership: Racial Capitalism, Black Wealth, and the Appreciation Gap in Atlanta. International Journal of Urban and Regional Research, 44(2), 310-328. https://doi.org/10.1111/1468-2427.12873

Popescu, I., Duffy, E., Mendelsohn, J., & Escarce, J. J. (2018). Racial residential segregation, socioeconomic disparities, and the White-Black survival gap. In M. Bowen (Ed.), PLOS ONE (Vol. 13, Issue 2, p. e0193222). Public Library of Science (PLoS). https://doi.org/10.1371/journal.pone.0193222

Rothwell, J. T., & Massey, D. S. (2010). Density Zoning and Class Segregation in U.S. Metropolitan Areas*. In Social Science Quarterly (Vol. 91, Issue 5, pp. 1123–1143). Wiley. https://doi.org/10.1111/j.1540-6237.2010.00724.x

Shapiro, T., Meschede, T., & Osoro, S. (2013). The roots of the widening racial wealth gap: Explaining the black-white economic divide. https://doi.org/10.13016/pvyx-ebny

Sharp, G., Whitehead, E., & Hall, M. (2020). Tapped Out? Racial Disparities in Extra household Kin Resources and the Loss of homeownership. Demography, 57(5), 1903-1928. https://doi.org/10.1007/s13524-020-00913-4

Thomas, M. E., Moye, R., Henderson, L., & Horton, H. D. (2018). Separate and unequal: The impact of socioeconomic status, segregation, and the Great Recession on racial disparities in housing values. Sociology of Race and Ethnicity, 4(2), 229-244. https://doi.org/10.1177/2332649217711457

Thomas, M., & Moye, R. (2015). Race, class, and gender and the impact of racial segregation on Black-White income inequality. Sociology of Race and Ethnicity, 1(4), 490-502. https://doi.org/10.1177/2332649215581665

Williams, R. B. (2017). Wealth privilege and the racial wealth gap: A case study in economic stratification. The Review of Black Political Economy, 44(3-4), 303-325. https://doi.org/10.1007/s12114-017-9259-8