Renters of color historically have a harder time qualifying for housing than similarly qualified white renters, but that’s not all. They also have to pay more to live in virtually the same unit and area as equally qualified white renters.

Why is this happening?

Renters of color pay more in application fees and security deposits. Rent remains high for all groups, which forges an even tougher financial struggle when met with added fees — the coup de grace for renters already struggling to make ends meet.

Nationally, from March through August 2021, two-in-five renters who moved said rising rents was their main reason for leaving. Of those respondents who moved during these six months, the share of renters who relocated due to rent hikes was:

  • 63% of Latinx renters;
  • 56% of Black renters;
  • 41% of Asian renters; and
  • 38% of white renters, according to Zillow.

As well as paying more security fees, renters of color also needed to submit more applications than white renters. When application fees are already higher for renters of color, the additional applications typically required to secure a rental add up.

On average, white and Asian renters need to submit two applications before receiving approval to rent, whereas Black and Latinx renters submit three applications. On average, landlords require:

  • white renters to make a security deposit of $600 and pay a $50 application fee;
  • Black renters to make a security deposit of $700 and pay a $65 application fee;
  • Latinx renters to make a security deposit of $650 and pay an $80 application fee; and
  • Asian renters to make a security deposit of $1,000 and pay a $100 application fee.

The Zillow study does not mention how security deposit amounts may coincide with rental prices. For example, higher security deposits are often required for higher-priced units, thus may skew the average deposit amounts displayed in this list.

For a more accurate view of the issue, consider the renter groups who needed to relocate due to rent hikes. In these cases of rapid rent increases and higher fees, landlords are by and large not showing bias on an individual scale. Rather, the higher rental burdens for households of color are the byproducts of deeply entrenched systematic discrimination.

For example, consider the ongoing effects of redlining. Redlining is the practice of denying mortgages and under-appraising properties in communities of color. Redlining was outlawed in 1977, but the residuals remain, leading to a decline in the quality and quantity of housing in communities seen as “risky.”

Related article:

Black mortgage applicants denied almost twice as often as white applicants

Say no to implicit bias and discrimination in real estate

Real estate professionals have a duty to combat racial factors and other types of discrimination playing any sort of role in the housing process.

In recognition of this duty, real estate agents and brokers with licenses expiring on or after January 1, 2023 will need to complete implicit bias training to renew their licenses.

firsttuesday’s Implicit Bias course will require licensees to learn:

  • the impact of implicit, explicit and systemic biases on consumers;
  • the historical and social impacts of those biases; and
  • actionable steps licensees may take to recognize and address their own biases.

Landlords, beware: charge tenants the same fees based on observable factors. For example, charging an additional pet fee is reasonable — but only when the landlord charges the same pet fee for all tenants with pets.

When you’re unsure what to be mindful of, turn to California’s Unruh Civil Rights Act, which protects against discrimination due to:

  • age;
  • ancestry;
  • color;
  • disability;
  • genetic information;
  • national origin;
  • marital status;
  • medical condition;
  • race;
  • religion;
  • sex (including gender identity and gender expression);
  • pregnancy; and
  • sexual orientation. [Calif. Civil Code §51(e)]

Landlords violating anti-discrimination protocols will face consequences, especially when a tenant takes legal action, which may result in money losses and civil penalties.  Going to trial is not a fun process for anyone, except for perhaps the lawyers making their livelihood off of it. Real estate professionals have their own livelihoods to protect. To start, check out Advertising Guidelines for Sales and Rentals for more information on how to avoid discrimination in practice.

Stay tuned for more information as the Implicit Bias course rolls out, expected to be published in July 2022.