How much does income matter in neighborhood choice?

Abstract

There is a substantial literature on the residential mobility process itself and a smaller contribution on how households make neighborhood choices, especially with respect to racial composition. We extend that literature by evaluating the role of income and socioeconomic status in the neighborhood choice process for minorities. We use individual household data from the Los Angeles Family and Neighborhood Study to investigate the comparative choices of white and Hispanic households in the Los Angeles metropolitan area. We show that income and education are important explanations for the likelihood of choosing neighborhoods. But at the same time, own race preferences clearly play a role. While whites with more income choose more white neighborhoods, Hispanics with more income choose less Hispanic neighborhoods. One interpretation is that both groups are translating resources, such as income and education, into residence in whiter and ostensibly, higher status neighborhoods. Copyright Springer Science+Business Media B.V. 2007Education, Income, Neighborhoods, Residential mobility,

Neighbourhood selection of non-Western ethnic minorities: testing the own-group effects hypothesis using a conditional logit model

“…Minority ethnic groups are found to be more likely than others to move to minorityconcentration neighbourhoods (Brama, 2006;Clark and Ledwith, 2007;Doff, 2010;South and Crowder, 1998) and less likely to leave these neighbourhoods (Bolt and Van Kempen, 2010;Feijten and Van Ham, 2009;Pais et al, 2009;Van Ham and Clark, 2009). These patterns of selective mobility lead to segregation.…”

“…In this paper we study selective inflow into neighbourhoods, which has received somewhat less attention. Existing research shows that ethnic minority households are more likely than others to move to high-ethnic-minorityconcentration (hereafter, minority-concentration) neighbourhoods (Clark and Ledwith, 2007;Doff, 2010;South and Crowder, 1998). This might be explained by own-group effects: ethnic minorities might live among others of their own-group because of own group preferences; because they want to live close to ethnic-specific facilities; or because of the ethnic-specific networks they use to find dwellings.…”

“…These studies have an important limitation: they generally characterise neighbourhoods based on a limited number of characteristics (Hedman et al, 2011). Studies typically model whether or not households move into a poor neighbourhood (Clark et al, 2006;Logan and Alba, 1993), or into a minority-concentration neighbourhood or not (Brama, 2006;Clark and Ledwith, 2007;Doff, 2010;South and Crowder, 1998). However, in reality, the selection of a neighbourhood will depend on multiple neighbourhood characteristics that are assessed simultaneously and in combination (Hedman et al, 2011).…”

Ethnic Residential Concentrations with Above-Average Incomes

“…2) became increasingly Asian during the 1990s (Allen and Turner, 2002). Other research from Los Angeles on actual residential shifts suggests that if White proportions in a neighborhood fall below 40%, the majority of Whites with above-average incomes who move locally from such neighborhoods will relocate to neighborhoods that are at least 40% White (Clark and Ledwith, 2007). On the other hand, if Whites tend to leave the more affluent, ethnically mixed neighborhoods and move to newer, more distant, or more expensive suburbs, we expect some Asians and Latinos will follow, thereby shifting the location of such mixed upperincome neighborhoods toward such places.…”

Residential mobility in context: Interpreting behavior in the housing market

“…A study by Datcher (1982) put the value at 25 percent attributable to the neighborhood, but a study by Nicoletti and Rabe (2012) attributed about 10-15 percent of the difference in educational outcomes to neighborhood effects. Studying the likelihood of mobility, Clark and Ledwith (2007) suggest that less than 5 percent of the explanation for the likelihood of moving can be attributed to neighborhood characteristics. It does appear that there are neighborhood effects across a wide range of outcomes, but the effects may best be identified as occurring at the margin rather than as the primary explanation for localized outcomes in education, mobility, health and deviant behavior.…”