So often we'll be out here or
we'll be inside and we'll come outside,
and there will be White people
standing right there on the stoop
reading, and it's like, this is
trespassing, and if you opened your
front door and saw a Black guy
standing there right at your front
door, you'd be like, "Cops."
If she were to show my mother
that house, she would lose her job.
In those days it was that blatant.
I've had agents
invoke burning crosses.
But that's just the difference
in like feelings of ownership.
In the United States, home ownership is
seen as the most effective way
to build generational wealth, with
the average homeowner having a
household wealth of $231,000 compared to
the average renter having a
household wealth of just $5,200.
But data shows discriminatory policies
left many Black Americans out
of the economic picture, and the
problem is only getting worse.
In the second quarter of 2019,
Black homeownership hit a 50-year low
of 40.6%.
In fact, if you look
at the 100 U.S.
cities with the largest population
of Black households today, every
single one of them shows a
growing divide between Black and White
homeownership. It has a lot to do
with today's frameworks and a lot
of the structural barriers,
discriminatory barriers, redlining issues
in communities, and also issues with
access to credit in our housing
finance systems. According to Urban
Institute data, the current gap
between White and Black homeownership
sits at about 30%.
That's larger than the 27% point gap
that existed in 1960, before the
Fair Housing Act was passed.
The Fair Housing Act in 1968 was
passed right around the same time as
the Civil Rights Act. That
really enabled and essentially abolished
the ability for real estate
property owners and others to
discriminate on the basis of race, sex
and a whole host of other
critical factors.
It was just a little over 50 years
ago that that was enacted, so this
is very recent history.
Fair housing policies are so recent
that stories of blatant housing
discrimination still echo
for Black Americans.
When my parents went to go purchase
their home in Toledo, Ohio, my mom
actually wanted to buy a home
in a predominantly White suburb called
Sylvania, Ohio.
The real estate agent explained to my
mother that she could not show
my mom the home
because we were Black.
And she explained to my mom that if
she were to show my mother that
house that she would lose her job.
So she took my mom to a community
in Toledo where she said they were
moving Black families who are kind
of like in our income bracket.
Rice was just six months old when
her family moved into their home in
1963. At the time, they were the
only Black family on the block.
By the time she started kindergarten
in 1968, her neighborhood was
predominantly Black.
That's how quickly the neighborhood
changed because of real estate
blockbusting and
steering practices.
Blockbusting is a now-illegal tactic used
by real estate agents and
developers who convince White homeowners to
sell their homes out of
fear that racial minorities will move
into the neighborhood and lower
property values. Steering is the unlawful
act of limiting where you
show a person a particular
home based on race.
As our neighborhood was designated as
what they called then a
"changing neighborhood," meaning the real
estate community and the
lending community understood that Black
people would be moving into
this area, the lenders
began redlining the area.
Redlining is a practice that was started
in the 1930s by the Home
Owners' Loan Corporation, where neighborhoods
would get color grades
based on perceived
mortgage security.
At the time, neighborhoods were coded as
green for type A, blue for
type B, yellow for type C,
and red for type D.
Type A neighborhoods were viewed
as financially reliable, while type
D neighborhoods were viewed
as financially insecure.
But here's where it gets ugly.
Type D neighborhoods were predominantly
populated by Black families,
meaning that even if a Black
person living in that area was
credit-worthy, banks would
still deny them.
So when my dad went to his bank
to get a loan, the loan officer
actually told him, "Mr.
Rice, we're not making loans in
that neighborhood." In those days it
was that blatant.
Like, "We're not making loans below
Upton Street." And so that's why
my parents had to go
to a subprime lender.
Subprime loans became a fixture
in redlined neighborhoods, and though
redlining was outlawed in the 1960s,
its impact still has lingering
effects on Black people today.
Over the last 40 years,
property values in redlined neighborhoods
gained half the value of
those in green-lined neighborhoods.
By the '90s, subprime lenders
started pushing adjustable rate
mortgages, which are loans that typically
start off with low interest
rates and then drastically increase
after just a few short years.
We saw payments increasing by 50%.
So imagine if one month your mortgage
payment is $1,000 and the next
month your mortgage
payment is $1,500.
It's a huge increase.
This increase in adjustable rate
mortgages led to more borrowers
refinancing their homes every two
to three years, slowly stripping
them of their equity every
time they made a payment.
According to Rice, brokers pushed
subprime loans because they were
making a lot of money doing it.
In fact, between 1994 and 2000,
the amount of new subprime mortgages
grew from $35 billion
to $140 billion.
Between 2004 and 2007, Hispanic Americans
and Black Americans were 78%
and 105% more likely than White
Americans to have a high cost
mortgage. Consequently, Black and
brown families were
disproportionately impacted by the
2007-2010 housing crisis, with
both groups being nearly twice as
likely as White families to lose
their homes. Before the housing crisis
hit, the median net worth of
Black households was a little over
$12,000, compared to the nearly
$135,000 net worth
of White households.
By 2009, those net worths dropped
to about $5,700 and $113,000
respectively. While redlining and subprime
loans robbed Black families
of the opportunity to build
wealth in the 20th century,
there was something just as
insidious on the horizon: gentrification.
In major metropolitan areas that
were once predominantly Black,
homeownership levels have drastically shifted
as a result of
gentrification and rising
housing costs.
Gentrification involves the renovation
of properties and businesses
in underfunded neighborhoods, which some
see as a positive thing.
The negatives come when
long-term residents, who disproportionately
tend to be people of color,
are pushed out of those neighborhoods
as the neighborhoods begin
to be well-resourced.
Between 2000 and 2013, more
than $135,000 residents in 230
neighborhoods across the country were
displaced from their homes due
to gentrification.
Like, we withstood all this shit.
We're still withstanding.
I definitely feel less at home than I
used to, but also kind of more
at home because of the businesses.
They give me hope. They give me
a sense of ownership that I've known
them longer than the wave.
Parker has watched a wave
of gentrification transform his
Bedford-Stuyvesant neighborhood in
Brooklyn, New York.
Parker's parents purchased their brownstone
home for $90,000 in 1985.
Today, similar properties in his neighborhood
sell for well over $1
million. So a lot of my family
lives on this block right here.
These two houses, these are
my mom's best friends.
Most of the businesses in
Parker's neighborhood are still
Black-owned, but home ownership
has changed drastically.
And a lot of that has to
do with marketers and developers literally
changing the name of the
neighborhood to suit affluent buyers.
The whole renaming and remarketing
of Bed-Stuy into Stuyvesant
Heights, it's an old name, and
then there was never a stark
difference. It's more like regional than
lines, but now they're trying
to call the whole
Bed-Stuy, Stuyvesant Heights.
It's a marketing ploy because Bed-Stuy has
now a history, so that it
becomes more palatable for these parents
to pay for their kids to
come live here. Since the 1930s,
Bedford Stuyvesant has been a
predominately Black neighborhood.
As of 2000, the Black community
made up three quarters of the
population. By 2015, that
number dropped to half.
Parker's parents retired after the 2008
recession, but the family has
three other tenants to
lighten the financial burden.
And while their home value
has increased significantly since 1985,
Parker says refinancing is difficult
because of his parents' retired
income. As he's gotten older,
Parker understands how important home
ownership is for his
family's long-term financial stability.
If your parents own a home,
help them keep the home.
Okay? Contribute.
Make an effort.
Do some work around the house.
Do anything that
will guarantee your...
How can I say this? Your legacy?
Your legacy, yes.
Gentrification is taking place in
Black and brown neighborhoods across
the country, but not all families
are as fortunate as Parker's.
In Detroit, a third of the
city's properties have foreclosed since
2008 due to rising
costs and tax inflation.
A January 2020 investigation by
The Detroit News found that
homeowners in the city were collectively
overtaxed by at least $600
million dollars following
the Great Recession.
Homes in the cities are being assessed
at a value that was much
higher than the market rate.
This overtaxation of local properties
led to Michigan's Black home
ownership rate dropping from over 50%
in 2000 to 40% in 2016.
In a 2020 report from the
Washington Center for Equitable Growth, it
was shown that on average, Black
and Hispanic residents bear a
10-13% higher property tax burden
than White residents nationally.
According to experts, county
assessors have historically overtaxed
Black residents as a form
of punishment for economic mobility.
This practice of overtaxing Black
residents has only gotten worse
with the surge of gentrification.
So what we see, unfortunately, is
people are being squeezed out on
multiple fronts as
gentrification happens.
And if cities want to prevent
this from happening, they have the
power to do that.
They can adopt tax lean and
tax forgiveness programs to help people
stay in their homes as
the values are rising.
They can adapt homestead programs so
that long term residents who
have been living in the communities for
a long time are able to stay
as the communities become more
wealthy, so to speak.
Recent studies show that housing
discrimination is still prevalent
today. A three-year investigation released
by Newsday in 2019 found
that real estate agents in Long
Island, New York asked for different
financial qualifications from White homebuyers
than they did from
Black and brown homebuyers.
The report also found evidence
that many agents still practice
steering when showing homes.
To stop these acts of
discrimination from taking place, government
agencies and advocacy groups
have conducted paired testing
experiments where they send two subjects,
one White and the other a
person of color, to act as potential
buyers or renters for a home.
I've had agents call me colored,
and this is in New York.
I've had agents invoke burning crosses
to dissuade me from buying a
home in certain areas.
Experiences can vary.
For the most part, you do not know.
But I have had some experiences
where the treatment was so blatant
that you just sort of have
to maintain your poker face.
Don't encourage or or dissuade them from
continuing and just try to go
about acquiring the information.
In situations where acts of
housing discrimination weren't as blatant,
Carter says he would later find out
that an agent told him a property
was no longer available when it really
was, or that an agent didn't
return his call about a property on
the market, but returned the call
of a White tester inquiring
about the same home.
Recently, the federal government proposed
rollbacks on fair housing
policies. In July of 2020,
President Trump tweeted that he's
rescinding the Affirmatively Furthering Fair
Housing Act, an act
passed by the Obama administration to
further the protections of the
1968 Fair Housing Act.
In response to the federal
government's position on housing
discrimination, experts say state officials
need to step up to
enforce stricter fair housing laws.
We've been seeing more people filing
with state agencies or going to
the state courts in order to
exercise their rights under the law.
We've been seeing some attorneys general
stepping up to the plate to
exercise their state's
fair housing laws.
While states work to uphold fair
housing laws, real estate experts
recommend that potential first-time homebuyers
look to grant programs
and financial resources that will
make homeownership more accessible.
Homeownership is the #1 way for
families and individuals to build
wealth in the United States.
Now, it's not the only way, but it
is the #1 way, and I don't see
anything on the horizon
changing that paradigm.
So we have to make sure that
communities of color have access to
homeownership opportunities.
And for Black homeowners wanting
to stay in gentrifying
neighborhoods, Parker's aunt, a
homeowner in Bed-Stuy, says
collective action is the
only way forward.
If three young couples buy
a three-family, guess what?
They could afford it.
But you know what?
We have to learn how
to live with each other.
That's the key, okay?
And guess what?
What's happening in the world right
now is making us live together.
Live together, actually. Okay?
