Study: Homes In South Florida's Black Neighborhoods Are Undervalued

Dec 26, 2018

Homes in black neighborhoods in Miami, Fort Lauderdale and West Palm Beach are being undervalued, according to a study released last month by the Brookings Institute.

In South Florida, homes in predominantly black neighborhoods are valued at $41,000 less than comparable homes in white neighborhoods.

The study, titled “The Devaluation of Assets in Black Neighborhoods,” found across the country racism plays a role in the value of a home.

The researchers found even when a predominantly black neighborhood shared the same types of amenities and characteristics of a predominantly white neighborhood, the black neighborhood’s homes were valued lower than the same types of homes in white neighborhoods.

A home in majority black neighborhoods across Miami-Dade, Broward and Palm Beach counties would be worth $41,000 more if it wasn't undervalued.
Credit Brookings Institute

The researchers call that “the cost of racial bias” and the implications are costly for black homeowners, resulting in a cumulative loss of $156 billion.

The study’s authors noted that history is likely influencing how people view and value majority black neighborhoods — 350 years of slavery, Jim Crow laws and subsequent explicit racist housing policies like redlining.

“Our findings are generally consistent with the widespread presence of anti-black bias—whether unconscious or not, ingrained stereotypes and automatic associations of a particular group, and even outright discrimination and racism,” the researchers wrote.

And the study found the devaluation of these homes affects how much wealth a family has to pass on from one generation to the next, making “it more difficult to start and invest in business enterprises and afford college tuition for their children.”