Higher security deposits and more application
fees add to an already stressful and pricey renting
experience
- Black, Latinx and Asian American Pacific Islander renters
report paying application fees that are 43% higher than those paid
by white renters.
- 30% of Asian American Pacific Islander renters report paying
at least $1,000 for a security
deposit compared to 17% of white renters.
- Zillow allows renters to apply for an unlimited number of
participating rentals for 30 days for a flat fee.
SEATTLE, April 6,
2023 /PRNewswire/ -- It's more difficult than
ever to afford a rental after prices skyrocketed during the
pandemic. With affordability as tight as it is, the upfront costs
for renting are a major burden that could put the cost of moving to
a new rental out of reach. Renters of color are more likely to
report paying these upfront costs, and oftentimes, the fees are
higher.
According to Zillow's Consumer Housing Trends
Report1, the typical Black, Latinx and Asian
American Pacific Islander (AAPI) renter all reported spending
$50 per rental application while
white renters reported paying $35. In
addition to the higher amount spent, Black and Latinx renters were
nearly twice as likely to report submitting five applications or
more before securing a rental. (Thirty-eight percent of Black and
Latinx renters report submitting five or more applications,
compared to 21% of white renters.)
"Monthly rent prices are nearly the highest they've ever been,
and unfortunately for so many people, finding a place to rent comes
at an even higher cost," said Manny
Garcia, a population scientist at Zillow. "We so often hear
about the benefits of renting and the flexibility it offers, but
disparities persist, and many renters of color aren't granted the
same mobility as others because of higher upfront costs."
Renters looking to lower the cost of application fees may have
options. Zillow offers renters an online application process that
provides renters with a single form they can use to apply to as
many participating properties on Zillow as they'd like over a
30-day period for a flat fee.
Zillow data indicates that the average renter who used Zillow
Applications in 2022 applied for at least three rentals.
Considering the median application fee is $50 for renters who report paying one, Zillow's
application process could save the typical renter applying to three
or more participating properties more than $100. Additionally, our universal application
feature offers just a "soft" credit pull, protecting renters from
having their own credit score impacted by applying for an
apartment.
Application fees are not the only upfront costs to consider.
Once a rental is secured, nearly all renters (85%) report putting
down a security deposit. In 2022, the typical security deposit
reported was between $500 and
$999. This means that for renters who
are already struggling financially, such as the 38% who said they
couldn't afford an unexpected expense of $1,000 in 2021, security deposits could be a
significant obstacle to signing a new lease.
The burden is often greater for renters of color, who are more
likely to report paying a more expensive security deposit: 39% of
Latinx and 43% of AAPI renters paid at least $500 for their deposit, and 22% of Latinx and 30%
of AAPI renters paid at least $1,000.
Given these affordability constraints, it's especially important
for renters to be aware of their rights in the communities where
they are searching. Zillow rental listings display available local
legal protections, including source of income and LGBTQ+
anti-discrimination laws. While source of income protections do not
currently exist in all 50 states, Zillow believes families who
depend on alternative sources of income, including housing choice
vouchers, should be able to secure a comfortable home, free from
discrimination. Zillow strongly supports efforts to expand these
protections nationwide.
About Zillow Group
Zillow Group, Inc. (NASDAQ: Z and ZG) is reimagining real estate
to make it easier to unlock life's next chapter. As the most
visited real estate website in the United
States, Zillow® and its affiliates offer customers an
on-demand experience for selling, buying, renting, or financing
with transparency and ease.
Zillow Group's affiliates and subsidiaries include Zillow®;
Zillow Premier Agent®; Zillow Home Loans™; Zillow Closing
Services™; Trulia®; Out East®; StreetEasy®; HotPads®; and
ShowingTime+℠ , which houses ShowingTime®, Bridge Interactive®, and
dotloop® and interactive floor plans. Zillow Home Loans, LLC is an
Equal Housing Lender, NMLS #10287 (www.nmlsconsumeraccess.org).
1 2022 Zillow Consumer Housing Trends
Report. Zillow Group Population Science conducted a nationally
representative survey of 8,300 unique renters — more than 2,500
recent renters and 5,700 tenured renters. The study was fielded
between March and June 2022.
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SOURCE Zillow