Racial Rent Differences in U.S. Housing Markets June 18, 2018 By Edgar O. OlsenPaul E. CarrilloDirk W. Early Racial Rent Differences in U.S. Housing Markets This paper exploits an unusually rich data set to estimate racial differences in the rents paid for identical housing in the same neighborhood in U.S. housing markets and how they vary with neighborhood racial composition. It overcomes the shortcomings of the data used in previous studies. It is large (over 400,000 observations), covers all parts of the country, and contains detailed information about the housing units and their immediate neighborhoods and the census block group of each unit. Importantly, due to the sample size, there are many blacks living in predominantly white neighborhoods and many whites in predominantly black neighborhoods. Results suggest that households led by blacks pay more for identical housing in identical neighborhoods than their white counterparts and that this rent gap increases with the fraction of the neighborhood white. In neighborhoods with the smallest fraction white, the premium is about 0.6 percent. In neighborhoods with the largest fraction white, it is about 2.4 percent. This pattern holds across different types of areas, namely the 50 largest metro areas, all other metro areas, non-metro areas, and areas with the highest and lowest levels of racial segregation in housing. ECO-DISCRIMINATION-TEXT-TABLES-6-18-18.pdf Edgar O. Olsen Ed Olsen is a professor of economics in the College of Arts and Sciences, where he served as chairman of the Department of Economics, and a professor of public policy in the Frank Batten School of Leadership and Public Policy. Read full bio Paul E. Carrillo George Washington University Dirk W. Early Southwestern University Related Content Edgar O. Olsen Alleviating Poverty through Housing Policy Reform Research The purpose of this paper is to describe proposals for reform of low-income housing assistance that will alleviate poverty without increasing public spending. Low-income housing assistance is fertile ground for such reforms. Reforming Housing Assistance Research Getting better outcomes with less public spending is always desirable, and our current fiscal situation adds urgency to this task. Low-income housing assistance is fertile ground for such reforms.