," by Alex Mikulas, Brenden Beck, & Max Besbris. 04/10/2025. Socius 10 (2024). https://doi.org/10.1177/23780231241261606, (Original work published 2024).
Although rates of residential racial segregation and home prices are undoubtedly related, the temporal nature of the relationship has rarely been studied. Using fixed effects models in a cross-lagged framework, this study examined how prior changes in segregation and home prices at the metro level predict changes in the other. To examine how prices and ethno-racial segregation are related over time, we gathered data on 398 metropolitan statistical areas (MSAs) for the years 1980, 1990, 2000, 2010, and 2019.
The findings suggest that increases in home prices predict increasing racial segregation years later, but increases in segregation fail to predict subsequent change in home values. Metros that experience a 1 standard deviation increase in home prices experience an associated 0.25 standard deviation increase in Black-White segregation 10 years later and a 0.18 standard deviation increase 20 years later. No relationship is observed for Hispanic-White segregation. We discuss implications for understanding the economic underpinnings of segregation. Findings also offer insight into future segregation trends and illuminate how changes in the housing market may drive demographic trends more broadly.
Different strands of research have shown how varying rates of appreciation of property values exacerbate racial wealth gaps. Indeed, racial disparities in home equity are the largest component of racial wealth gap. The racial gaps in home value are also larger in more segregated places, and prior work has theorized the relationship between housing value and segregation as a primary way the racial wealth gap is maintained.
Although Black-White segregation continues to fall at a faster rate relative to other race groups’ segregation from White individuals, it is still at the highest overall level compared to other ethno-racial group segregation from White individuals, and mobility patterns do little to bring Black-White segregation to parity with other race groups overall.
In urban settings, Hispanic residents have had near-stable segregation levels from White neighbors but have increasingly shared residential space with Black neighbors over the same time frame (Iceland and Sharp 2013), and metropolitan Hispanic-Black segregation is decreasing at a much faster rate than Hispanic-White segregation.
The findings provide strong evidence that changes in metro-level home prices precede Black-White segregation levels. This is an important and salient point to consider as home prices soar to historic highs across the U.S., suggesting continued or increasing segregation may soon follow.
