The National Association of Real Estate Brokers (NAREB) has released its 2021 State of Housing in Black America (SHIBA) Report, in which it finds that the gap in homeownership between Black and white families is wider today than in the decades when housing discrimination was legal.

According to the U.S. Census, as of the second quarter of 2021, the Black homeownership rate was 44.6% compared to 74.2% for whites, a gap of 29.6%. 

In 1960, before the Civil Rights movement and Fair Housing laws, there was a 27% gap — over 2.5 points less than today’s gap — between Black homeownership (38%) and white homeownership (65%).

“The SHIBA report takes a critical look at the causes for the disparity in Black homeownership rates when compared to whites and recommends initiatives aimed at closing the gap,” said Lydia Pope, NAREB’s president, noting that in the past 15 years Black homeownership experienced the sharpest decline of any demographic. “Blacks have made little, if any, strides at closing the homeownership gap. Systemic discriminatory regulations and policies continue to thwart any meaningful effort at increasing Black homeownership.”

Much of the overt housing discrimination prior to the 1968 Fair Housing Act has declined, but the SHIBA report found that housing discrimination still flourishes. 

More subtle forms of racial bias have emerged and become common, such as racial steering, where real estate agents deliberately steer Black home buyers away from white neighborhoods and toward neighborhoods with larger concentrations of people of color.

“There are new biased practices that are obstructing Black homeownership in communities across the country,” said Pope. “For instance, housing providers often don’t advertise available units and discriminatory digital marketing has become more common due to the proliferation of social media and online housing advertising. We need new tools to address this new wave of housing discrimination.”

According to the report: 

  • The typical white family holds eight times the amount of wealth held by the typical Black family, a disparity that translates into an estimated $24,100 media net worth for Black households compared to $188,200 for white families.
  • Homeownership is the largest component of median household wealth, accounting for 67% of an average household’s net worth. Home equity averages 70% a Black household’s net worth, compared to 59% of a white household.
  • Several metropolitan areas with growing Black populations have homeownership rates that are well below their national average. In Minneapolis, for example, only 25% of Black families own their homes, making Minneapolis the U.S. metropolitan area with the lowest Black homeownership rate in the nation.
  • Even when Blacks secure mortgages, they face substantial challenges to building equity. Not only are their loans more costly than whites, but their homes appreciate less or are valued less than similar homes in white communities, even after considering housing characteristics.  
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