Panel: African-American homeownership rates should concern all homeowners, and the industry
This week, as we celebrate the legacy of Martin Luther King Jr., we’re reminded that although great strides have been made for equality in housing under the Fair Housing Act, inequalities remain.
And may widen, according to panelists at the recent National Housing Conference (NHC) held in Washington, DC. Lynn Fisher, Vice President of Research and Economics at the Mortgage Bankers Association, described the gap between white and minority homeownership rate as “vast and growing.” Fisher says the white-black homeownership gap is 29 percentage points, an increase from 25.7 percentage points 20 years ago.
Panelist Doug Ryan, the Director of Home Ownership at Prosperity Now, said African-Americans are still reeling from the housing crisis of 2008, when many “lost their wealth.” Ryan told attendees the racial disparities in homeownership are a driver of the growing racial wealth divide, predicting that by 2043 the average white household will have $1.2 million in wealth, while the average black household will have a fraction as much, at $107,000.
“It’s quite concerning that 50 years after the enactment of the Fair Housing Act, African-Americans have lost ground economically,” Ryan said.
Agatha So, a policy analyst at Latino civil rights advocacy group UnidosUS, told attendees the racial divide in homeownership should concern every homeowner and the industry at-large.
Citing research from the Harvard Joint Center for Housing Studies that predicts that by 2035, more than 80 percent of new households will be people of color, So told attendees. “These are the prospective homebuyers, but there’s a great chance they won’t be buying homes.”
“These are people who have either been shut out of the housing market historically or have had trouble entering it for various reasons today,” she continues. “If they’re not buying homes, that not only jeopardizes their own opportunities to build wealth, but ultimately the entire mortgage finance and home-building industries.”
Ryan believes there are ways to boost minority homeownership rates. “We need housing stock. We need starter homes. And we need low-cost construction models.”
Innovations that might just help bridge the racial divide, and help all American homeowners in the process.