Recent research indicates that houses located in religiously mixed areas of Northern Ireland command prices approximately 10% higher than comparable properties in segregated neighborhoods. The study was led by Rachel Cho, Hisham Farag, Christoph Görtz, Danny McGowan, Huyen Nguyen, and Max Schröder. To make such realizations, they integrated big data with traditional data sources.
Using intensive qualitative and quantitative methods, the economists built their analysis by drawing on data from the PropertyPal website, property title deeds, and other archival sources. In their analysis, their findings expose a surprising turn in a historical trend favoring living near people with similar backgrounds.
Real estate data finds that homes located in religiously diverse neighborhoods command a price premium. Indeed, this unfortunate trend underscores the positive dividends that cultural diversity has to offer.
“Moreover, multicultural neighbourhoods often boast better schools, public services, and opportunities for social interaction, indicators of the positive spill overs of cultural diversity.” – Rachel Cho, Hisham Farag, Christoph Görtz, Danny McGowan, Huyen Nguyen and Max Schröder
The research focused on the impact these neighborhoods had on housing prices in segregated versus integrated communities. It illustrated the economic advantages to residing in less homogenous environments. Looking beyond property value gains, the economists acknowledged that these benefits cover social effects as well.
Historically, there has been a tendency for individuals to prefer residing near those who share similar cultural or religious backgrounds. The prevailing wisdom today is being reversed by these new findings, which show that mixed areas have unique qualities that make them more desirable.
“The attractiveness of multicultural areas suggests that encouraging diversity could be a powerful policy tool to regenerate neighbourhoods, improve public services, and foster social integration.” – Rachel Cho, Hisham Farag, Christoph Görtz, Danny McGowan, Huyen Nguyen and Max Schröder
This study provides insight into the complicated role of social dynamics in racially and ethnically heterogeneous contexts. Though multicultural spaces can produce beneficial results like enhanced service delivery and community engagement, they can be fraught with pain.
“In more culturally diverse areas, differences in cultural attitudes and norms can lead to lower levels of social cohesion and cooperation, or even – in rare cases competition and conflict.” – Rachel Cho, Hisham Farag, Christoph Görtz, Danny McGowan, Huyen Nguyen and Max Schröder
These findings, John Campbell, the economics and business editor at BBC News NI, said, are “incredibly significant.” They are important pieces in the larger, ongoing movement toward smart growth practices and better community planning. Everything we know tells us that more of the economic benefits are found in diverse communities. We need to better understand these effects to inform future policy efforts.
