- "For homebuyers, it’s not impossible" to find economically diverse places to live, just "really hard," Redfin says.
- Places with a balanced mix of home prices cover just 13 percent of major U.S. cities, according to a study released by Redfin.
- This is cause for concern because economic segregation by neighborhood stunts economic mobility.
Some neighborhoods sparkle with luxury properties and BMWs. In others, terms like “country club” and “summer home” rarely pass from residents’ lips.
Somewhere in between is a rarer type of community, residential oases where silver spooners and the working class live side by side, enjoying what tend to be the the same safe streets and and highly ranked schools.
“For homebuyers, it’s not impossible to find these places,” said Nela Richardson, chief economist at high-tech brokerage Redfin, in a statement. “But it’s really hard.”
That’s the key takeaway of a study released by Redfin on economic integration. It found that places with a balanced mix of home prices cover 13 percent of major U.S. cities.
Boston topped the list of the most economically integrated of the 20 major U.S. cities that Redfin look at, with 51 percent of the city having a balanced home-price mix, followed by Seattle (31 percent) and Washington, D.C. (30 percent).
Philadelphia (11 percent), Baltimore (11 percent) and San Francisco (10 percent) showed up near the bottom of the list, with Columbus (4 percent), Indianapolis (6 percent) and Detroit (7 percent) ranking the lowest.
Cities with low economic integration can be either predominantly affordable or predominantly expensive. Baltimore and San Francisco, for example, are economically segregated in opposite ways.
Middle-income San Francisco families can’t afford about 88 percent of San Francisco homes, while middle-income Baltimore families can afford 86 percent of Baltimore homes, Redfin found.
|City||Balanced Mix Area||High-end Area||Affordable Area|
Redfin also drilled down to the neighborhood level, flagging the five most economically integrated neighborhoods in each city (see charts at bottom).
The results of Redfin’s study are cause for concern because economic segregation tends to stunt economic mobility, experts say.
“Communities with a mix of homes and prices help improve economic opportunity and inclusion for all residents,” Richardson said. “When families of varying socioeconomic standing live in the same place, everyone enjoys the same safe streets and highly ranked schools.”
Some experts have expressed concern that property search tools may exacerbate economic divides between neighborhoods by mixing local data, like crime and school ratings, into the real estate search experience.
Redfin measured the economic diversity of areas by tagging millions of properties as either affordable or high-end based on a property’s sale price and the purchasing power of a local-median income family. The brokerage then rated each city and neighborhood as either mostly affordable, mostly high-end or a blend of the two based on the mixture of affordable and pricey homes.
“If an area had more than three affordable houses or condominiums sold for every expensive one, we labeled it affordable,” Redfin wrote in a blog post. “Areas with more than three pricey homes sold to every economical one were considered high-end. In between were the balanced areas, with a wide range of home prices.”
|Highland Park (Roxbury)||79%||Bay Village||100%||Uphams Corner||79%|
|Egleston Square||75%||Back Bay||100%||Hyde Park||68%|
|Mission Hill||65%||North End / Waterfront||100%||Mattapan||65%|
|Hyde Square-Jackson Square||64%||Beacon Hill||93%||Bowdoin Ave Area (Dhrchester)||64%|
|South End||90%||Franklin Field||60%|
|U District||82%||Laurelhurst||71%||Victory Heights||100%|
|Alki||69%||Madison Park||69%||Columbia City||100%|
|Queen Anne||61%||Windermere||50%||Yesler Terrace||100%|
|Columbia Heights||100%||The Palisades||100%||Fort Davis||100%|
|West End||100%||Spring Valley||92%||River Terrace-Lily
Morgan / Kalorama Heights / Lanier Heights
|Barney Circle||85%||West Village (Georgetown)||81%|
|Platt Park||100%||Bonnie Brae||100%||Westwood||100%|
|Jefferson Park||88%||Washington Park||62%||Green Valley Ranch||100%|
|Sloan Lake||76%||Belcaro||54%||Ruby Hill||100%|
|West Highland||75%||Cherry Creek||50%||Clayton||100%|