There’s more to the racial wealth gap than just who owns homes.
As activism against racial disparity and systemic racism continues to grow across the country, it’s important for those of us in the housing sector to keep race at the forefront of our work. As we’ve reported before, the Black/white homeownership gap has worsened, not improved, since the passage of the Fair Housing Act in 1968.
Today, there is a nearly 30-point gulf between Black and white homeownership rates. To get a better understanding of what this means, compare median net worth by race. In 2016, the average net worth of Black households was $17,150; for white households it was $171,000. That’s a 10-fold difference.
But there is more to the story than just the racial homeownership gap. The value of Black-owned homes is significantly determined by the racial composition of their neighborhoods. A Brookings study in 2018 found that “homes of similar quality in neighborhoods with similar amenities are worth 23 percent less ($48,000 per home on average, amounting to $156 billion in cumulative losses) in majority-Black neighborhoods, compared to those with very few or no Black residents.”
In Minneapolis, where the killing of George Floyd just six weeks ago sparked a national surge of anti-racist protests, that difference is about $33,000. However, Minneapolis also has one of the worst racial homeownership gaps in the nation.
We’ve written in the past about the history of redlining in this country — where lines on maps deprived African-Americans of access to credit and homeownership and depressed home values. New data shows that those “redlining” disparities are not a relic of the past; they are still with us in 2020 and affecting the lives and wealth of Black households every day.
To learn more about Black equity in America, we recommend Andre Perry’s Know Your Price: Valuing Black Lives and Property in America’s Black Cities.