This is not good news for potential homeowners. Black homeownership has dropped to its lowest level since at least 1970, just two years after the passage of the Fair Housing Act which was established to protect minorities against discrimination in the selling, leasing
“The rate among Black Americans was 40.6 percent in the second quarter, down from 41.6 percent a year earlier and the smallest share since the Census Bureau began keeping consistent data almost 50 years ago,” Bloomberg reported. The rates for whites climbed increased to 73.1 percent.
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Why has Black homeownership gone down? There is a shortage of properties that are affordable to buy since starter-home prices have risen, year after year. “In the second quarter, the homeownership rate for all Americans fell to the lowest since 2017, and the number of new homeowner households grew by only 585,000, a third of the year-earlier level and the fewest since 2006,” Bloomberg reported.
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“The trends in the homeownership rate reflect a broader racial chasm in who is able to acquire the American dream,” Ralph McLaughlin, deputy chief economist at CoreLogic Inc, said. “Black homeowners are much more rare today than any time in the last 50 years.”
This latest trend has all but erased the gains Black homeowners had made during the last 30 years, during which time Black homeownership reached nearly 50 percent in 2004.
“Homeownership is the number one way for African Americans to build wealth,” Ron Cooper, president of the National Association of Real Estate Brokers (NAREB), told The Scotsman Guide for realtors. “There are so many other things tied to it.”
He added: “We lost a trillion dollars worth of wealth that we must regain. For America in general, if 2 million Black homeowners bought homes, that raises the economy. America does well.”
It may take up to a generation for Black homeownership rates to recover, said Rolf Pendall, co-director of the Metropolitan Housing and Communities Policy Center at the Urban Institute.
“It is going to take a lot more than simply making it easier for people to get mortgages to really overcome the long history,” Pendall said. “It is a 75-year history, more than that, hundreds of years of a legacy of discrimination. You can’t just undo that by making mortgages easier to get.”
He continued: “If people think that African Americans don’t want to own homes, that is a misconception. Instead, it is because they can’t access homeownership.”