A new data analysis published by Zillow (NASDAQ: Z, ZG) is claiming that homes in majority-white neighborhoods in the Chicago area were more than twice as likely to be marketed through private listings than homes in predominantly minority communities.
Zillow researchers examined data from Midwest Real Estate Data (MRED), the multiple listing service that covers the Chicago area, which has operated and promoted its own private listing network. Over the past month, Zillow found that homes for sale in MRED’s private listing network were 2.2 times more likely to be in majority-white neighborhoods, even after controlling for price, home type, location, and broker activity.
In majority-white areas, 7.9% of homes for sale within MRED were listed privately. In predominantly minority areas, that share was 3.4%.
In presenting its findings, Zillow alleged private listings could lead to a new era of racial disparities in housing.
“Chicago shows what can happen when parts of the housing market move into the shadows,” said Zillow Senior Economist Orphe Divounguy. “Private marketing might sound appealing, but it risks deepening segregation and limiting opportunity, moving us further from the fair and open housing market consumers deserve. The data show clear disparities, and good intentions are no longer an excuse for expanding digital redlining.”
Zillow’s data also included input from Michael Chavarria, executive director of the HOPE Fair Housing Center, who stated, “Zillow’s decision to confront the data and its calls for the real estate community to open listings to all consumers is an example the industry must follow. Homebuyers deserve the right to see all the homes available in an area — not to have those choices quietly made for them.”
