Submitted by: Submitted by nbryanjohnson
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Category: Business and Industry
Date Submitted: 07/07/2011 07:36 AM
Running head: Ethnic Housing Market
Tapping the Ethnic Housing Market
Nate Johnson
MBA 666 – Consumer Behavior
Benedictine University
Professor Kelley Lovati
May 15, 2011
Opportunities and Challenges for Housing Lenders and Realtors
The text highlights some pretty significant differences between the general population and minority groups in regards to the housing market. I look at the tables and see clear differences, but let me take the road less traveled or read between the lines and suggest that the biggest challenge for lenders and realtors is the poverty trap created by housing discrimination. According to the U.S. Census Bureau, in 1990 25.3% of all Anglo-Americans in the U.S. lived in central city areas. The percentage of African Americans living in inner cities was 56.9%, and the percentage of inner city Hispanics was 51.5%. Asian Americans living in central cities totaled 46.3% (Wikipedia, 2011). Furthermore, the average white person living in a metropolitan area lives in a neighborhood that is 80% Anglo and 7% Black, while the average African American lives in a neighborhood that is 33% white and more than 51% black (Wikipedia, 2011). These statistics don’t necessarily point to evidence of housing discrimination, but rather to segregation based on historical reasons which have made minorities more economically deprived and prone to living in more poverty-stricken inner city areas (Wikipedia, 2011).
In a comprehensive study by the U.S. Department of Housing and Urban Development (HUD) in 2000, paired-tests (in which two applicants of different races but the same economic status and credit scores apply to rent or buy a house) were used to determine whether or not statistics about segregation truly pointed to housing discrimination. This study reported that although adverse treatment of minorities has decreased over time, roughly 25% of white applicants were still favored above those who were African-American or Hispanic. About 17% of...