Zillow Says Renters Of Color Pay More In Fees Than White Renters
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Zillow Says Renters Of Color Pay Higher Security Deposits, More Application Fees

FILE PHOTO: A "For Rent" sign is displayed in front of an apartment building in Arlington, Virginia, U.S., June 20, 2021. REUTERS/Will Dunham

Zillow, the real estate marketplace company, has released its Consumer Housing Trends Report, which shows renters of color pay more in security deposits and application fees than white applicants.

The Zillow report, released last August, states the average rental application is around $50, which doesn’t seem like much but can get expensive if a person is filling out multiple applications. Zillow’s report adds that Black and Latino people are more likely to rent than own and typically apply to more rentals before finding a place.

According to Zillow, white renters said the average application fee is $50, while Black renters said $65 and Latino renters said $80.

In addition to application fees, security deposits are also unfairly tied to race. The report states that 90% of renters paid a security deposit in 2021 with an average of around $700. Zillow’s report shows a higher share of renters of color (93%) paid a higher deposit than white renters (85%). The average amount paid by Black renters ($750) was also higher than white renters ($600).

The housing market for renters has become increasingly volatile as rents continue to climb, but wages have struggled to follow. Even gains made by employees during the COVID-19 pandemic’s economic recovery have been wiped out due to rising inflation. In addition to rising rents, homes are also now harder to purchase due to significant demand and a shortage of new homes due to supply chain issues. Even trailer parks are dealing with a significant rise in rents as investment companies expand their mobile-home park portfolios, threatening the stability of one of the last truly affordable housing options.

“Rents grew more last year than any year on record, forcing many renters to look for a more affordable option. According to Essence, about 2 in 5 renters who moved in the past year said a rent hike influenced their decision to move,” Manny Garcia, population scientist at Zillow, said. “Renters typically do not have much of a financial cushion, and the cost of finding a new place to live can be an expensive burden. Regrettably, renters of color are especially likely to experience rising rents, and when they shop for a new rental, generally report higher upfront costs, restricting the mobility that is often held up as a benefit of renting.”