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The market for real estate brokerage services in low- and high-income neighborhoods: A 6 city study

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  • Yelowitz, Aaron
  • Scott, Frank
  • Beck, Jason

Abstract

We examine the market structure for real estate brokerage services across six large metropolitan areas, by collecting more than 300,000 real estate listings and computing the Herfindahl-Hirschman Index (HHI) for each neighborhood. When we divide neighborhoods based on income, house value, and race, we find no evidence of redlining; that is, the market structure for brokerage services is at least as competitive in less advantaged neighborhoods as it is in more advantaged ones.

Suggested Citation

  • Yelowitz, Aaron & Scott, Frank & Beck, Jason, 2011. "The market for real estate brokerage services in low- and high-income neighborhoods: A 6 city study," MPRA Paper 35608, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:35608
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    File URL: https://mpra.ub.uni-muenchen.de/41052/1/MPRA_paper_41052.pdf
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    References listed on IDEAS

    as
    1. Lawrence J. White, 2006. "The Residential Real Estate Brokerage Industry: What Would More Vigorous Competition Look Like?," Working Papers 06-06, New York University, Leonard N. Stern School of Business, Department of Economics.
    2. Paul M. Ong & Michael A. Stoll, 2007. "Redlining or risk? A spatial analysis of auto insurance rates in Los Angeles," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 26(4), pages 811-830.
    3. Berkovec, James A & Canner, Glenn B. & Gabriel, Stuart A. & Hannan, Timothy H., 1994. "Race, Redlining, and Residential Mortgage Loan Performance," The Journal of Real Estate Finance and Economics, Springer, vol. 9(3), pages 263-294, November.
    4. Munnell, Alicia H. & Geoffrey M. B. Tootell & Lynn E. Browne & James McEneaney, 1996. "Mortgage Lending in Boston: Interpreting HMDA Data," American Economic Review, American Economic Association, vol. 86(1), pages 25-53, March.
    5. Caitlin Knowles Myers & Grace Close & Laurice Fox & John William Meyer & Madeline Niemi, 2011. "Retail Redlining: Are Gasoline Prices Higher In Poor And Minority Neighborhoods?," Economic Inquiry, Western Economic Association International, vol. 49(3), pages 795-809, July.
    6. Jason Beck & Frank Scott & Aaron Yelowitz, 2012. "Concentration and Market Structure in Local Real Estate Markets," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 40(3), pages 422-460, September.
    7. Beck, Jason & Scott, Frank & Yelowitz, Aaron, 2010. "Competition and market structure in local real estate markets," MPRA Paper 27531, University Library of Munich, Germany.
    8. Donald Haurin & Christopher Herbert & Stuart Rosenthal, 2007. "Homeownership Gaps Among Low-Income and Minority Households," Working Papers 07-02, Ohio State University, Department of Economics.
    9. Ethan Cohen-Cole, 2008. "Credit card redlining," Supervisory Research and Analysis Working Papers QAU08-1, Federal Reserve Bank of Boston.
    10. Ethan Cohen-Cole, 2011. "Credit Card Redlining," The Review of Economics and Statistics, MIT Press, vol. 93(2), pages 700-713, May.
    11. Geoffrey M. B. Tootell, 1996. "Redlining in Boston: Do Mortgage Lenders Discriminate Against Neighborhoods?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 111(4), pages 1049-1079.
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    Cited by:

    1. Aaron Yelowitz, 2017. "Local housing costs and basic household needs," Empirical Economics, Springer, vol. 52(3), pages 901-923, May.

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    More about this item

    Keywords

    HHI; real estate brokerage competition; Herfindahl-Hirschman Index; redlining;
    All these keywords.

    JEL classification:

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

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