Property owners with African-sounding names are systematically undervalued in Luxembourg's housing market, losing an average of €20,000 per sale, according to a recent study by LISER.

A recent study by the Luxembourg Institute of Socio-Economic Research (LISER) has uncovered evidence of racial discrimination in Luxembourg's housing market, particularly affecting property owners with African-sounding names.

The research, published ahead of the International Day for the Elimination of Racial Discrimination on 21 March, found that properties linked to African names received offers 3-4% below market value, resulting in an average financial loss of approximately €20,000 per sale.

The experimental study, conducted in collaboration with the University of Luxembourg, the University of Cambridge, and the University of Economics and Business in Vienna, asked participants to appraise properties based on current market prices in Luxembourg. Ads featuring sellers with African-sounding names were consistently undervalued compared to identical listings associated with names more common in the Greater Region.

Dr Giorgia Menta, a researcher at LISER involved in the study, explained that such "hidden prejudices" can significantly impact wealth accumulation over time. Property owners from minority groups may unknowingly receive lower offers, which exacerbates existing racial disparities in wealth and has long-term economic consequences, she said.

The study also revealed that the phenomenon was particularly pronounced among older participants and those with lower levels of education, regardless of their attitudes toward migration. LISER suggests that this points to statistical discrimination rather than overt racial prejudice.