A recent study by the National Community Reinvestment Coalition (NCRC) reveals that the homeownership gap between Black and white Americans is larger than at any point throughout the 1900s. Despite the 1968 passage of the Fair Housing Act, which was meant to close the discriminatory gap between Black and white homeowners, a smaller percentage of Black Americans own homes today than during the early 1900s, Insider reports.
Discriminatory practices by mortgage lenders and real estate agents as well as a lingering racial wealth gap leave Black Americans at a severe disadvantage on the path to homeownership. Even after purchasing a home, the wealth gap is sustained by disproportionate home equity values. Black homeowners accumulate an average of $27,000 in equity, while white borrowers have an average of $79,000.
It turns out the pandemic home buying boom disproportionately helped white, Indian, and Chinese homeowners, although homeownership rates among Asian buyers overall are still much closer to that of Black and Latino people, according to the Urban Institute. Despite the passage of anti-discrimination laws in the 1960s, a smaller percentage of Black Americans own homes today than in the early 1900s. NRCR researchers wrote that the racial homeownership gap has never been larger.
"This appears to be a market failure, where it excludes certain groups perennially," Jason Richardson, the NCRC's senior director of research, told the Center for Public Integrity's Jamie Smith Hopkins. "That drives a persistent racial wealth gap as well.