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Homeownership Gap Eyed

October 19, 2001

Homeownership rates in Southern California differed by 22 percent between African Americans and whites, according to a study by the University of Southern California's Lusk Center for Real Estate. But it's not clear that discrimination is at root.

The study used remodeled data to explain the homeownership gap. After researchers separated the groups based on choice of location and adjusted for income differentials, the homeownership gap disappeared altogether for households relocating to the disenfranchised South Central Los Angeles community or to suburban San Bernardino County--or roughly 50 percent of the sample population.

With the other half of the sample, there was a 60-percent decrease in the disparity between African-American and white homeowners. However, these changes succeeded only in reducing--not eliminating--the homeownership gap for households moving to other parts of Los Angeles County.

The study proves, according to an academic, that "researchers still have a lot to learn about how minorities, and whites, make their housing market decisions."

Source: Real Estate Finance Today (10/15/01); Sorohan, Mike