Why black homeownership rates lag even as the housing market recovers

Brandeis University News



A decade after the housing crash destroyed the American Dream for millions of homeowners, black homeownership rates have dropped to levels not seen since the 1960s, hobbling African-Americans' efforts to build their wealth.Nationally, only 42.2 percent of blacks owned homes in 2016, compared with 71.9 percent of whites, according to a new report by Harvard University's Joint Center for Housing Studies. And in Chicago, the gap between black and white homeownership rates is even more extreme. Only 38.9 percent of African-Americans owned homes in the Chicago area in 2015, compared with 74 percent of whites. Before the housing crash, almost half of African-Americans in the Chicago area owned homes, according to Harvard's research. Latinos in the Chicago area also lag when it comes to homeownership. Only 50.5 percent of Latinos owned homes in the area in 2015.








Local efforts are underway to help more Chicago-area residents become homeowners, something that would help strengthen neighborhoods and put those individuals on a stronger financial path.
"homeownership is a way for people to generate stability and wealth and not just go to work every day," said Deborah Moore, neighborhood planning director for Neighborhood Housing Services of Chicago, a nonprofit that helps Chicago residents buy and keep homes. In addition, homeownership can "change the trajectory of neighborhoods," she said.Without homes, blacks lack a powerful source of wealth creation, said Jonathan Spader, senior research associate with the Harvard center. Homeowners generally build equity that allows them to eventually buy other homes or businesses and send children to college. Homes also are passed to younger generations upon death, allowing future generations to build wealth."Because whites are far more able to give inheritances or family assistance for down payments due to historical wealth accumulation, white families buy homes and start acquiring equity an average eight years earlier than black families," researchers Thomas Shapiro, Tatjana Meschede and Sam Osoro of the Institute on ...

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