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Price Discrimination in the Housing Market

Publication ,  Other
Bayer, P; Casey, M; Ferreira, F; McMillan, R
Published in: Economic Research Initiatives at Duke (ERID)
May 1, 2012

This paper sets out a new research design to test for price discrimination by sellers in the housing market. The design controls carefully for unobserved differences in the quality of neighborhoods and homes purchased by buyers of each race, using novel panel data from over two million repeat-sales housing transactions in four metropolitan areas. The results indicate that black and Hispanic homebuyers pay premiums of around 3 percent on average across the four cities – differences that are not explained by variation in buyer income, wealth or access to credit. The estimated premiums do not vary significantly with the racial composition of the neighborhood or, most strikingly, the race of the seller. This latter result rules out racial prejudice or animosity on the part of sellers as the primary explanation for the estimated premiums.

Duke Scholars

Published In

Economic Research Initiatives at Duke (ERID)

Publication Date

May 1, 2012

Issue

127
 

Citation

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Bayer, P., Casey, M., Ferreira, F., & McMillan, R. (2012). Price Discrimination in the Housing Market. Economic Research Initiatives at Duke (ERID).
Bayer, P., M. Casey, F. Ferreira, and R. McMillan. “Price Discrimination in the Housing Market.” Economic Research Initiatives at Duke (ERID), May 1, 2012.
Bayer P, Casey M, Ferreira F, McMillan R. Price Discrimination in the Housing Market. Economic Research Initiatives at Duke (ERID). 2012.
Bayer, P., et al. “Price Discrimination in the Housing Market.” Economic Research Initiatives at Duke (ERID), no. 127, 1 May 2012.
Bayer P, Casey M, Ferreira F, McMillan R. Price Discrimination in the Housing Market. Economic Research Initiatives at Duke (ERID). 2012.

Published In

Economic Research Initiatives at Duke (ERID)

Publication Date

May 1, 2012

Issue

127