(Bloomberg) — Renters of color are more likely to pay a security deposit than white people, according to a new report from Zillow Group Inc. They pay an average higher security deposit of $750, compared to $600 for white people, and were more often tasked with paying the application fee.
Renters of color also have to apply for more apartments to secure a home. The average number of rental applications for White or Asian American and Pacific Islander renters is two, while Black or Latinx renters average three. More than a third of Black or Latinx renters report submitting five or more different applications.
It can add up quickly. As Zillow reports, the typical White renter pays an average application fee of about $50, while a typical Black renter paid $65, a typical Latinx renter paid $80, and a typical Asian American and Pacific Islander renter paid $80. Paid $100.
One reason for the discrepancy is location. Whites are more likely to rent in less expensive rural and Midwestern markets, an area that a December report from the National Bureau of Economic Research found to be the most hostile to potential black renters. Meanwhile, Asian Americans and Pacific Islanders and Latinx people often rent in the West, where there are many more expensive real estate markets.
More than half of black and Latino-headed households rent their homes, according to an analysis of census data by the Pew Research Group. Black, Native American and Latino renters are also more likely to have incomes at or below the federal poverty level, the National Coalition for Low-Income Housing found. No state currently has a sufficient amount of rental housing for very low-income residents.
Rental prices are rising across the country as the housing market continues to explode in nearly every state. Rental prices for single-family homes increased by an average of 7.8% in 2021. About 70% of Americans — a record share — think rents will continue to rise this year. And it’s already driving people looking for new housing: According to the Zillow study, 63% of Latinx renters, 56% of black renters, and 41% of Asian American and Pacific Islander renters said they had to move because of the rent spike. Was driven to 38% in their current rental compared to White renters.
To contact the authors of this story: Claire Ballantyne in New York [email protected]
Ella Cerrone in New York [email protected]
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