Housing investment returns differ systematically by neighborhood racial composition

Evidence

If you’re buying a home, never spend your maximum housing budget in a predominantly black neighborhood—you simply won’t get a good return on your investment. (That also makes home equity loans riskier, so avoid those as much as possible in predominantly black or diverse neighborhoods.) Either spend less in a diverse neighborhood, making sure that you have disposable income remaining to invest in retirement, 529 plans, or stocks after your mortgage payments, or use your full budget to buy a smaller home in a white neighborhood. — Dorothy A. Brown, The Whiteness of Wealth, 531

Categorization

• XREF: connects to: Housing-market discrimination makes purportedly free market choices illusory — Luke W. Cole and Sheila R. Foster, From the Ground Up: Environmental…, 317; Market-dynamics siting outcomes remain racist once housing discrimination is factored in — Luke W. Cole and Sheila R. Foster, From the Ground Up: Environmental…, 336; Financial loss aversion outweighed racial solidarity in fleeing neighborhoods — Kevin M. Kruse, White Flight: Atlanta and the Making of…, 230 (+9 more)
• yield-rescued: below the book’s yield-target cutoff, included anyway for connecting to: Housing-market discrimination makes purportedly free market choices illusory — Luke W. Cole and Sheila R. Foster, From the Ground Up: Environmental…, 317; Market-dynamics siting outcomes remain racist once housing discrimination is factored in — Luke W. Cole and Sheila R. Foster, From the Ground Up: Environmental…, 336; Financial loss aversion outweighed racial solidarity in fleeing neighborhoods — Kevin M. Kruse, White Flight: Atlanta and the Making of…, 230 (+9 more)

Broader Connections

• Neighborhood racial composition drives home appreciation and tax outcomes. #expands (0.94) — Dorothy A. Brown, The Whiteness of Wealth, 208