Non-white house hunters are being discriminated against in the rental market and face more barriers to securing a lease than Anglo people, according to new Australian research.
A study by a group of Sydney academics sent testers of the same age and sex to more than 350 inspections in the Sydney housing market and found that Indian and Middle Eastern people were disadvantaged by most measures compared with people of Anglo appearance.
Members of ethnic minorities are less likely to be offered individual appointments to view properties and be told important information such as deadlines for rental applications.
Agents favoured Anglo renters by telling them but not minorities about other housing in 26.8% of cases. Only 7% of ethnic renters received this preferential treatment.
Agents also gave preferential treatment to Anglos by giving further information about applications (by a difference of 16.2%), having “off script” discussions with them (by a difference of 12.8%) and asking them about their housing needs (by 10%).
Extra information benefiting Anglo testers included the deadline for an application or existence of slightly cheaper housing nearby, said a coauthor of the study, Prof Heather MacDonald.
Indian and Muslim Middle Eastern testers were more likely to be told all renters must sign the lease (rather than just one renter), with 16.3% “favoured” by this metric compared with 1.9% of Anglos. According to MacDonald, this metric represented “a bit of a barrier” as it added to the list of hoops a renter needed to jump through to secure a lease.
Agents were more likely to take ethnic testers’ details (by a difference of 7.4%) and initiate a discussion with them (by 6.1%) but favoured Anglos by contacting them after inspections by a difference of 6.5%.
MacDonald said that, despite the unfavourable treatment, ethnic testers reported agents were “warm and friendly” to them and it was “very unclear to any of them that they’d been discriminated against”.
“It’s hard to determine how your experience is different from others, so if the system relies on complaints of discrimination you’re going to underestimate how often it happens,” she said.
The president of the Real Estate Institute of NSW, John Cunningham, said it was “taking the report seriously” because it had a “reasonably good sample group [from which] to draw conclusions”.
Cunningham said it was clear there could be more training on racial discrimination but it was a matter for the regulator, NSW Fair Trading, to improve the compliance and regulatory framework. Mandatory training to gain and hold a real estate licence did not cover compliance with discrimination law, he said.
“When you get reports like this, they’re good alarm bell ringers,” he said.
The NSW Residential Tenancies Act and regulations do not deal with discrimination but NSW and federal anti-discrimination laws make it unlawful for a landlord or agent to discriminate by providing an inferior service based on grounds including race. NSW Fair Trading refers people who believe they have been discriminated against to the NSW Anti-Discrimination Board.
In August 2015 NSW Fair Trading signed a memorandum of understanding with the NSW Anti-Discrimination Board for the agencies to conduct joint trader education visits and inspections focusing on discrimination issues. The two agencies will also identify “potential problem traders”.
Felicity Huntington from the NSW Anti-Discrimination Board said it was difficult to know the extent of discrimination because people were reluctant to lodge a formal complaint.
Huntington said the Anti-Discrimination Board did explain discrimination law to agents as part of continuing professional development delivered by NSW Fair Trading.
“I hope … since we’ve got the MOU signed we can make some changes to hopefully get real estate agents to do the right thing and not just judge people by appearances or by their names and write them off,” Huntington said.
A paper on the study, Rental Discrimination in the Multi-Ethnic Metropolis: Evidence from Sydney, will be published in academic journal Urban Policy and Research.
Guardian Australia has contacted NSW Fair Trading for comment.