The Maze of Urban Housing Markets

Abstract

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Job Relocation and the Racial Gap in Unemployment in Detroit and Chicago, 1980 to 1990

“…In other words, individuals' residential-location decisions may be based on relatively stable characteristics of neighborhoods such as group or class preferences to live in particular areas, the neighborhood's reputation and status level, fear of crime, the quality of local schools and services, transportation networks, and other geographic characteristics. Empirical studies of housing markets, for example, emphasize the importance of neighborhood externalities, such as the occupation, income, and racial composition of neighborhood residents, on the market prices of individual houses and (Coulson and Bond 1990;Rothenberg et al 1991).…”

“…Care should be taken when relying on changes in housing values to reflect unobserved individual characteristics. First, housing markets are sensitive to local and national macroeconomic conditions like interest rates and may fluctuate cyclically and others (Rothenberg et al 1991). For this reason, I use relative rather than absolute changes in housing values.…”