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Neighborhood Racial Transition and Housing Returns: A Portfolio Approach

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Abstract

A portfolio test was used to determine whether neighborhood racial transition impacts the risk/return of housing. We conclude that the diversification advantages of residential real estate were adversely affected by racial transition and that hedge efficiency was positively related to neighborhood income and the proportion of owner occupancy. This result applied only to neighborhoods with a high rate of racial transition and was independent of neighborhood racial composition.

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  • Michael Devaney & William Rayburn, 1993. "Neighborhood Racial Transition and Housing Returns: A Portfolio Approach," Journal of Real Estate Research, American Real Estate Society, vol. 8(2), pages 239-252.
    • Handle: RePEc:jre:issued:v:8:n:2:1993:p:239-252
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    Cited by:

    1. Douglas Coate & Richard Schwester, 2008. "Black-White Appreciation of Owner Occupied Homes in Upper Income Suburban Integrated Communities: The Cases of Maplewood and Montclair, New Jersey," Working Papers Rutgers University, Newark 2008-001, Department of Economics, Rutgers University, Newark.

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    • L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services

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