New Data Shows a Persistent Black-White Homeownership Gap
The National Association of Real Estate Brokers (NAREB) recently released its “2023 State of Housing in Black America” (SHIBA) report. It offered new research on the depth of the Black-White wealth gap relative to Black homeownership. Analyzing 2022 Home Mortgage Disclosure Act (HMDA) data, NAREB found Black homeownership lingers at 45%, which is only slightly higher than it was two years after the 1968 Fair Housing Act was signed into law. This legislation prohibits discrimination in the rental, sale, negotiation, or withholding of housing based on an individual's race, skin color, religious beliefs, gender, family situation, disability, or country of origin.
In 1970, the Black homeownership rate was 42%, and it remains the lowest among US racial groups today. National Association of Realtors (NAR) data from 2021 shows the homeownership rate for Whites was 72.7%, for Asian Americans it was 62.8%, and for Latinos it was 50.6%.
The gap between Blacks and Whites in homeownership is larger today than it was over half a century ago. In 1970, it was 23.8%; in 2022, it’s nearly 30% according to NAREB. To mitigate this racial homeownership gap, especially in the Black community, it’s imperative housing counselors and their organizational partners work to increase homeownership and prevent foreclosure there.
These barely changing homeownership statistics for Black Americans, when homeownership is the basis of wealth for most US families, underscores the need for organizations like HomeFree-USA.
Founded in 1994, the nonprofit housing counseling organization is working to be the premier bridge to financial strength and homeownership success for people of color and all communities across America. According to HomeFree-USA, this commitment is the reason why its founder and CEO, Marcia Griffin, won a 2023 Joseph R. Biden Presidential Lifetime Achievement Award.
A Black-founded and led nonprofit organization, HomeFree-USA is dedicated to empowering homeowners not just to buy their homes, but to keep them. Housing counselors who understand the community play a critical role in helping homeowners retain their most valuable asset, especially in the face of foreclosure.
The nonprofit provides housing counseling services and extensive financial literacy education to low-resource communities across the US but maintains a significant presence in the Black community from its Prince George’s County, Maryland offices.
Housing Counseling that Turns Renters in Sustainable Homeowners
HomeFree-USA housing counselors educate clients unfamiliar with the complexities of homeownership. “Many of our clients are lifelong renters who don’t have the benefit of homeownership education passed down to them from previous generations,” says Plummer. “They often lack access to resources and financial services that provide financial literacy.”
“That’s why we call our housing counselors ‘angels,’ because we look at our work as ministry,” Plummer, the son of a pastor, says. HomeFree-USA’s counselors assume the demanding task of reshaping their clients’ perspectives, so they learn to create generational wealth through homeownership. This transformation centers on developing financial awareness, including of the costs of some mortgage products, like expensive predatory mortgages, which Plummer says “are designed to cost homeowners their homes.”
So, HomeFree-USA teaches them how to build assets like savings, budgeting fundamentals and creditworthiness. That allows their clients to get conventional mortgages at lower interest rates that don’t become too costly to manage.
But it goes beyond getting a mortgage, he says. “It also requires they understand the true costs of homeownership, which are their responsibility, since they no longer have a landlord to call to fix things.”
Plummer also says, “Our clients work with us long after they buy their homes, so they can learn the financial skills necessary to keep their homes,” he says.