Impacts of housing and mortgage market discrimination racial and ethnic disparities in homeownership

Abstract

There are persistent differences in homeownership rates across racial and ethnic groups. Homeownership rates for whites are over 20 percentage points higher than for blacks or Hispanics. This paper uses a model of the housing tenure decision to gain a better understanding of these racial and ethnic differentials in homeownership and employs a decomposition technique that has been applied to labor market discrimination to report the results of the empirical testing of two hypotheses: (1) race (ethnicity) influences the probability of ownership through differences in household endowments (income, education, age, gender, and family type) and market endowments (price and location); and (2) race (ethnicity) directly influences the probability of ownership through racial or ethnic discrimination and other factors that may be correlated with race or ethnicity.

We find endowment effects important in explaining the persistent racial and ethnic disparities in homeownership. In brief, logit analysis of 1989 American Housing Survey (AHS) national sample data reveals that 81 percent (78 percent) of the differences between the predicted probability of ownership between black and white households (Hispanic/non‐Hispanic) are due to differences in group endowments. Direct effects explain 19 percent of the black‐white differentials and 22 percent of the Hispanic/non‐Hispanic differentials. Because the direct effects are modeled as residual differences, it must be realized that the residual components could also be capturing the influence of important omitted or harder to measure variables internal to the market process and correlated with race or ethnicity. These include wealth, household location, employment history, credit history, and cultural predisposition toward homeownership.     

Where the homeless come from: A study of the prior address distribution of families admitted to public shelters in New York City and Philadelphia

Abstract

This study investigates hypotheses regarding the association of census tract variables with the risk for homelessness. We used prior address information reported by families entering emergency shelters in two large U.S. cities to characterize the nature ofthat distribution.

Three dense clusters of homeless origins were found in Philadelphia and three in New York City, accounting for 67 percent and 61 percent of shelter admissions and revealing that homeless families’ prior addresses are more highly concentrated than the poverty distribution in both cities. The rate of shelter admission is strongly and positively related to the concentration of poor, African‐American, and female‐headed households with young children in a neighborhood. It is also correlated with fewer youth, elderly, and immigrants. Such areas have higher rates of unemployment and labor force nonpartici‐pation, more housing crowding, more abandonment, higher rates of vacancy, and higher rent‐to‐income ratios than other areas.     

Comment on “Does the Likely Demographics of Affordable Housing Justify NIMBYism?”

Abstract

Automated underwriting (AU) systems have become the tool of choice in mortgage lending decisions. While these systems provide significant benefits to mortgage originators and investors, questions have been raised about their impact on underserved populations. The questions focus on the relative accuracy of AU compared with manual underwriting and whether AU has increased the flow of mortgage credit to underserved consumers.

Using information from Freddie Mac's Loan Prospector AU service, we provide statistics useful in examining these issues. The data strongly support our view that AU provides substantial benefits to consumers, particularly those at the margin of the underwriting decision. We find evidence that AU systems more accurately predict default than manual underwriters do. We also find evidence that this increased accuracy results in higher borrower approval rates, especially for underserved applicants.     

HOPE VI relocation: Moving to new neighborhoods and building new ties

Abstract

Severely distressed public housing developments are being torn down and redeveloped through the HOPE (Housing Opportunities for People Everywhere) VI initiative in cities across the United States. This article examines how families from one HOPE VI site decided where to move and how they fared in building social ties with their new neighbors. Semistructured interviews from a random sample of 41 families with children were analyzed.

Families that chose to move into public housing expressed concern about the unreliability of the Section 8 program and their own ability to pay the extra utility costs involved. Those who used Section 8 vouchers to relocate had more education on average and made this choice to improve the neighborhood for their families. Over the past two years, regardless of what kind of neighborhood they moved into, families have not rebuilt the close ties most of them had in their former neighborhood.     

The region is not dead: Long live the region—personal evaluations and voting at the 1992 British general election

There has been considerable debate regarding the reasons for the observed spatial variation in voting patterns at British general elections since the 1970s. Three separate models can be identified: no regional cleavage; regional economic cleavage; and autonomous regional cleavage. Analysis of data which indicated people's perceptions of their household and regional economic situations over the decade preceding the 1992 general election, together with their personal characteristics and attitudes, allows the first model to be rejected: there are clear regional differences in voting behaviour which cannot be accounted for by personal characteristics alone. Each of the other models is valid: there are clear spatial differences not only in interpretations of personal and regional prosperity, and its causes, but also in electoral responses to that; and there are significant residual regional variations when those are held constant. Approaches to the study of voting in Britain which present spatial variations as merely representations of other causes are thus rejected.     

STEIN'S SILK ROAD LEGACY REVISITED

An account of the four expeditions to Chinese Central Asia made at the beginning of the twentieth century by the Hungarian scholar, Aurel Stein; his discoveries and excavations in the ancient cities of the Silk Road, including the famous cache of scrolls he found at Dunhuang. The second part of the article covers the present day activities of the International Dunhuang Project and an expedition made in 2008 to retrace Stein's footsteps and replicate his photographs.     

Book reviews

Bremmer I &; R Tarras (eds), Nations and Politics in the Soviet Successor States. Cambridge: Cambridge University Press, 1993. 565pp., index.

Bulloch J &; H Morris, No Friends but the Mountains: The Tragic History of the Kurds. London: Penguin Books, 1993 (new epilogue). 257pp., index.

Cable J, Gunboat Diplomacy 1919 ‐ 1991: Political Applications of Limited Naval Power. London: Macmillan, 1994, 246pp.

Evans R, Deng Xiaoping and the Making of Modern China. London: Hamish Hamilton, 1993, 339pp.

Gaddis JL, The United States and the End of the Cold War: Implications, Reconsiderations, Provocations. New York: Oxford University Press, 1992, 301pp.

Jeffrey R, What's Happening to India? Punjab, Ethnic Conflict, and the Test for Federalism. London: Macmillan, Second Edition, 1994, pp. ii &; 252pp.

Mazrui AA &; C Wondji (eds), Africa since 1935. Paris: UNESCO; Oxford: Heinemann Educational; Berkeley: University of California Press, 1993. (UNESCO General History of Africa Series, Vol. VIII) xxiii, 1025 pp. Illustrated, maps, plates, bibliography and index.     

Assessing the Television Campaign: The Impact of Party Election Broadcasting on Voters' Opinions in the 1997 British General Election

Although paid television and radio political advertising is banned in the United Kingdom, parties fielding sufficient candidates are entitled to free air time during election campaigns for a fixed number of party election broadcasts (PEBs). Over the years, parties have experimented with a variety of different PEB formats. But the impact of PEBs on voters is underresearched. This article therefore analyzes the influence of PEB viewing in the 1997 British General Election. Though a majority do not view PEBs, those who do are influenced by them, especially in terms of their evaluations of parties and their leaders: Other things being equal, viewers of a party's PEBs become more favorably disposed to the party and its leader than those who do not see the broadcast. Labour and Conservative PEBs have no impact on vote intentions, however. But viewers of Liberal Democrat broadcasts become more likely to support that party. We speculate that this reflects different background levels of media exposure for the major parties as compared to the third party.     

Introduction: Great Underappreciated Works Deserving of Renewed Attention

Although news is a social construction that narrates events in the world by assimilating them to existing cultural categories, there are many cultural categories from which to choose. How do journalists determine whether an event calls for a melodramatic frame or an ironic frame or some other narrative convention? Reviewing two recent studies—of news coverage of 9/11 and news coverage in the early 1990s of an accidental killing of a Japanese exchange student in New Orleans—this article argues that the character of “the events themselves” helps limit what narrative frames journalists select.     

Raman Spectroscopy as a Simple,Rapid, Nondestructive Screening Test for Methamphetamine in Clandestine Laboratory Liquids

Raman spectroscopy has found increased use in the forensic controlled substances laboratory in recent years due to its rapid and nondestructive analysis capabilities. Here, Raman spectroscopy as a screening test for methamphetamine in clandestine laboratory liquid samples is discussed as a way to improve the efficiency of a laboratory by identifying the most probative samples for further workup among multiple samples submitted for analysis. Solutions of methamphetamine in ethanol, diethyl ether, and Coleman fuel were prepared in concentrations ranging from 0.5% to 10% w/v, and Raman spectra of each were collected. A concentration‐dependant Raman peak was observed at 1003 per cm in each solution in 4% w/v and greater solutions. Case samples were analyzed and also found to reliably contain this diagnostic peak when methamphetamine was present. The use of this diagnostic indicator can save the forensic controlled substances laboratory time and materials when analyzing clandestine laboratory liquid submissions.