A new paper published in Sociological Spectrum, “Renting Under Racial Capitalism: Residential Segregation and Rent Exploitation in the United States,” examines the relationship between rent exploitation and racial segregation, housing cost burdens, evictions, and other factors at the neighborhood level. The author, Amber Crowell, finds that higher levels of rent exploitation are more likely to occur in neighborhoods where Black and Latino households reside and in neighborhoods with higher concentrations of poverty. Her research reveals that rent exploitation increases as residential racial segregation increases at the neighborhood level. Ms. Crowell cites these findings as evidence that residential racial segregation facilitates the exploitation of renters in predominately Black, Latino, and poorer neighborhoods.
“Rent exploitation” refers to the phenomenon of landlords overcharging renters for rent relative to the value of the home they are renting. Ms. Crowell measured rent exploitation in her study as the ratio of median rents to median property taxes at the Census-tract level. Census tracts were used as proxies for neighborhoods. Ms. Crowell drew data on median rents, property taxes, renter housing-cost burdens, race, ethnicity, poverty, and other neighborhood characteristics from the American Community Survey (ACS). Data on evictions from Eviction Lab were employed for a secondary analysis of rent exploitation and evictions in Harris County, Texas.
Ms. Crowell found higher levels of rent exploitation in neighborhoods where Black and Latino households resided and neighborhoods with higher concentrations of poverty. Rent exploitation ratios ranged from 3.2 for the bottom 25% of neighborhoods with the least exploitation to more than 7.0 for the 25% of neighborhoods with the most exploitation. The median rent exploitation ratio was 4.7. The median rent exploitation ratio was higher for neighborhoods with a majority of Black households (6.4), neighborhoods with more than 15% of households living in poverty (5.7), and neighborhoods that were majority Black and had more than 15% of households in poverty (6.9).
After controlling for other factors, each percentage point increase in the share of Black households in a neighborhood corresponded to an increase of 0.04 in the median rent to median property tax ratio, while each percentage point increase in the share of households in poverty corresponded to an increase of 0.02 in the ratio. Ms. Crowell’s analysis also revealed that rent exploitation increased with greater neighborhood Black-White racial segregation. She observed that increases in rent exploitation levels were also associated with increases in renter housing-cost burdens.
The paper also includes a case study of Harris County, Texas, to examine the relationship between rent exploitation and neighborhood eviction rates. Ms. Crowell found higher eviction rates in neighborhoods with higher shares of Black and Latino households and higher shares of households in poverty. She did not, however, find an association between rent exploitation levels and eviction rates across neighborhoods in Harris County.
Ms. Crowell ultimately concludes that Black, Latino, and poorer renters disproportionately suffer from rent exploitation and negative housing outcomes, such as cost burdens and evictions. She further argues that residential racial segregation and a capitalist housing system work in tandem to devalue property in segregated communities while effectively holding residents captive for landlords to exploit. In short, racial capitalism creates the conditions in which landlords can exploit low-income renters and renters of color for greater profit.
Read the article at: https://bit.ly/3tDTl35