The importance of black homeownership

The gap between the wealth and homeownership rates of black Americans and white Americans is a daunting one, but the good news is that it’s growing slimmer. In recent years, the black homeownership rate has risen to 44% (that’s as of the first quarter of 2020). But while these numbers are increasing, there’s still progress to be made, particularly in the overall wealth of black Americans. In fact, according to a report by Prosperity Now, the median wealth of black Americans is projected to be at zero within the next 23 years. That’s why it’s important to keep up the momentum of these rises in black homeownership. Owning a home is one of the best ways to grow your wealth and help your household for generations. The more black Americans who own homes, the more the overall wealth will rise. So what can we do to boost black homeownership, and in turn, boost black capital?

What we can do

We certainly haven’t reached a dead end. There are many ways to continue to boost black wealth and homeownership in America.

One key factor is for lenders to provide better outreach and education about homeownership and the home buying process, especially when it comes to things like down payments. Many people are intimidated by the process simply because they don’t know enough about it.

Diversity in the real estate industry is another major factor in boosting black homeownership. Ensuring that there are more people of color working in the field and communicating with potential homeowners is a great way to build trust between lenders and black borrowers.

Of course, boosting black homeownership in order to boost black wealth can sound like a bit of a conundrum, especially since the housing supply has reached a low after the Great Recession. That’s where affordability comes in, and that’s where we really need the big guys and the stakeholders to step in and make some changes to ensure there’s plenty of affordable housing available for black Americans. In particular, we need to see changes in zoning and housing production, as well as stronger government mortgage programs. What you can do on a local level to make sure this happens is support and vote for officials who will make this a priority.

Even small progress is progress, so it’s great to see that the gap between black and white homeownership rates is getting smaller as more black Americans continue to buy houses. But this is just the beginning. It’s important that we continue to work towards a future of wealth equality and affordable housing for everyone.