Housing

Heritage and home

Investigating ethnic inequalities in housing affordability

6 February 2025

Britain, today, is a more plural country than ever before. But although recent polling has showed that the country has become more accepting over time, there is still ample evidence that significant ethnic inequalities exist. This note explores an ethnic inequality that has been largely under-researched to date: housing affordability.

Key findings

On average, ethnic minority adults live in households that spend a larger share of their income on housing than their White British counterparts. This is true for all ethnic minority groups, but it is especially the case for Bangladeshi, Black other and Arab adults, who spend more than twice as much of their household income on housing than White British adults (23 per cent, 24 per cent and 26 per cent respectively, compared to 11 per cent).
Housing tenure varies significantly by ethnicity. White British adults are more than twice as likely to live in a household that owns their home (outright or mortgaged) than Black African or Arab adults, for example (72 per cent, compared to 35 per cent and 31 per cent respectively). These tenure differences have a material effect on housing costs: on average, private renters pay more than three times per square metre of housing than mortgagors, and social renters pay twice the price.
Around 40 per cent of Black African and Pakistani adults are aged 19-34 years compared to 23 per cent of White British adults, and adults in every ethnic minority group are more likely than their White British peers to live in London or the South East. When we formally test how compositional factors explain the difference between the housing cost to income ratios of each ethnic group relative to White British adults, we find that except for Pakistani adults, tenure, age and region explain at least half of the gap. Tenure is by far the most important of the three.
The unexplained part of the housing affordability gap between ethnic minority and White British adults is not accounted for by ethnic minorities living in larger or better-quality homes. Ethnic minorities are more likely to live in overcrowded homes (for example, 22 per cent of Pakistani adults compared to 2 per cent of White British) and substandard housing. Bangladeshi, Black other, and Black African-headed households are around three times more likely to live in a damp home despite spending twice as much of their income on housing.
Some groups such as Arab, Indian, Pakistani and Bangladeshi adults have an especially strong sense of belonging to their neighbourhood for which they may be prepared to pay a premium. Less positively, racial and ethnic discrimination remains a reality for many in the UK when it comes to accessing housing, with 9 per cent of Arab, 7 per cent of Black Caribbean and 6 per cent of Black African adults reporting experiencing racial discrimination in accessing housing in the past. As a result, ethnic minority adults face more constrained housing choices than their White British peers in the UK today, plausibly pushing up the relative cost of housing.

Search site

Key topics

Timely research

Heritage and home

Search site

Keywords

Content type

Keywords*

Content type

Key findings

Further reading

Mailing list

Sign up below

I would like to receive:

I consent to my data being used in line with the privacy policy