Black homeownership has declined since 2012 — here’s where Black households are most likely to be homeowners


Blacks Americans are far less likely than their white peers to be homeowners — but in some cities, they have something of a leg up.

A new report from real-estate brokerage Redfin
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examined the national homeownership gap. Only 44% of Black families owned their homes as of the first quarter of 2020, compared with 73.7% of white households, Redfin found, based on an analysis of U.S. Census Bureau data.

But on a local level, the Black homeownership rate — and the gap in homeownership between white and Black households — varies widely. Redfin examined these data points across all metro areas with populations over 1 million.

Read more:Rents are softening nationwide — but here’s where they are falling the most

Washington, D.C., was the only city in the country where a majority of Black households were homeowners, with a homeownership rate of 51%. And half of Black families in Birmingham, Ala., were homeowners. That’s a major shift from 2012, when there were six cities where 50% or more of Black households owned their homes, and overall most cities have seen a decrease in the Black homeownership rate.

The decline in Black homeownership since 2012 is a reflection of the impact of the Great Recession. During the housing crisis, Black households faced foreclosure at twice the rate of their white neighbors, largely because Black homeowners were targeted with subprime loans, research shows. The financial hit Black communities took because of the recession was larger than other groups, making it harder for them to recover.

At the other end of the spectrum, only 25% of Black families in Minneapolis are homeowners, the lowest rate in the nation. Minneapolis also had the largest racial homeownership gap in the country, with a 51-point difference between the Black and white homeownership rates.

Metro area

Black homeownership rate (2018)

White homeownership rate (2018)

Median home-sale price (2018)

Washington, D.C.

51%

72%

$399,000

Birmingham, AL

50%

78%

$199,900

Richmond, VA

49%

75%

$246,500

Philadelphia, PA

48%

76%

$229,000

New Orleans, LA

47%

73%

$215,000

Atlanta, GA

47%

75%

$236,511

Memphis, TN

46%

75%

$177,000

Baltimore, MD

46%

77%

$270,000

Miami, FL

45%

74%

$275,000

Raleigh, NC

45%

74%

$282,500

Virginia Beach, VA

44%

72%

$229,900

Charlotte, NC

44%

75%

$242,000

Orlando, FL

44%

70%

$244,000

Jacksonville, FL

44%

72%

$227,000

San Antonio, TX

44%

71%

$223,458

Hartford, CT

43%

77%

$219,500

Austin, TX

43%

65%

$309,000

Nashville, TN

43%

72%

$286,000

Riverside, CA

42%

71%

$360,000

Houston, TX

42%

72%

$236,990

Detroit, MI

42%

78%

$177,000

St. Louis, MO

40%

77%

$177,333

Chicago, IL

40%

75%

$240,000

Denver, CO

38%

70%

$405,000

Tampa, FL

38%

71%

$224,990

Kansas City, MO

37%

72%

$210,000

Louisville, KY

37%

74%

$187,000

Dallas-Ft. Worth, TX

37%

69%

$269,900

Indianapolis, IN

36%

73%

$178,000

Cleveland, OH

36%

75%

$145,714

Oklahoma City, OK

36%

70%

$170,000

Tucson, AZ

36%

69%

$210,000

Pittsburgh, PA

35%

74%

$165,100

Columbus, OH

34%

69%

$203,000

Sacramento, CA

33%

67%

$395,000

Grand Rapids, MI

33%

78%

$195,000

Phoenix, AZ

33%

70%

$262,500

Los Angeles, CA

33%

58%

$645,000

Boston, MA

33%

69%

$455,000

San Francisco, CA

33%

61%

$900,000

Cincinnati, OH

33%

73%

$175,000

Seattle, WA

32%

65%

$479,500

Portland, OR

32%

66%

$391,000

Rochester, NY

32%

74%

$144,000

Providence, RI

32%

68%

$267,500

New York, NY

32%

67%

$403,000

Buffalo, NY

32%

73%

$149,900

San Jose, CA

31%

65%

$1,175,000

San Diego, CA

30%

61%

$569,995

Las Vegas, NV

29%

62%

$270,500

Salt Lake City, UT

28%

72%

$315,000

Milwaukee, WI

27%

70%

$206,000

Minneapolis, MN

25%

76%

$265,000

A multitude of factors have contributed to the lower rate of Black homeownership in this country. Historically, redlining policies barred Black Americans from accessing mortgage credit, preventing many of them from becoming homeowners in certain neighborhoods.

The term refers to the Federal Home Loan Bank Board and the Home Owners’ Loan Corporation creating color-coded maps designating how risky it was for lenders to originate mortgages in different neighborhoods across the country. The neighborhoods deemed most risky were outlined in red, and those neighborhoods tended to be predominantly Black.

Even before redlining practices existed, deed restrictions prevented people of color from purchasing homes in white communities. Racial covenants within the original deeds to these properties stipulated that only white people could purchase those homes.

Both practices were common throughout the first half of the 20th Century and were officially outlawed through a series of laws passed in the 1960s and 1970s. However, Black Americans are still far less likely to get a mortgage, and investigations have shown that racial bias persists in the real-estate industry.

The long-term effects of those historical policies remain. Homeownership is one of the main drivers of generational wealth in the U.S.; as a result the racial wealth gap remains large. Additionally, home prices are still depressed in historically redlined neighborhoods, which has stunted many Black families’ ability to grow their wealth and pass it on from generation to generation.

Also see:Mortgage rates keep falling to record lows — so is now a good time to refinance?

And the coronavirus pandemic threatens to exacerbate the racial gap in homeownership. “Black and Latino people have been hardest hit by stay-at-home orders and other public-health measures put in place to slow the spread of COVID-19 because of a legacy of occupational segregation,” Urban Institute vice president of housing finance policy Alanna McCargo and senior fellow Solomon Greene, wrote in a recent report.

Black and Latino households are disproportionately struggling to pay the rent, and those financial setbacks could make it more difficult to afford buying a home down the road. Additionally, 28% of black homeowners did not pay or deferred their mortgage payment in May, compared with just 9% of white homeowners, the Urban Institute reported.



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