How much does income matter in neighborhood choice?

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. 2007