The homeownership rate in the Black community was at nearly 50 percent a dozen years ago. Today, the figure stands at 41.5 percent and could get worse, experts warn.
The topic was discussed for more than two hours Thursday at the Congressional Black Caucus Foundation’s 46th Annual Legislative Conference at the Washington Convention Center in northwest D.C.
“We are at a state of crisis … and the state of crisis is real,” said Nikitra Bailey, executive vice president of the North Carolina-based Center of Responsible Lending. “The state of housing in black America is weak.”
To increase homeownership in the black community, the National Association of Real Estate Brokers (NAREB) has launched an ambitious initiative to secure two million new black homeowners in the next five years.
The organization based in Lanham, Maryland, commissioned a report this year (http://bit.ly/2btEWxY) with graphs, charts and other information to highlight the need for black homeownership.
http://bit.ly/2btEWxY) with graphs, charts and other information to highlight the need for black homeownership.
“Homeownership is the single most important asset for wealth accumulation by the typical American household,” the report states. “Black families attempting to become homeowners have largely been trapped, either in a vicious cycle of predatory mortgage schemes or by an absolute denial of access to home loans.”
The report shows that the average wealth of black families in 1983 was less than $100,000, compared to more than $300,000 for whites. Ten years later, it averaged about $85,000 for blacks and $656,000 for whites.
Some of the immediate housing-market reforms the report recommends, specifically for mortgage companies Fannie Mae and Freddie Mac:
• Require lenders to use the most updated and predictive credit-scoring technologies;
• Both agencies continue to find more effective ways to leverage their distressed loans and foreclosed properties to promote affordable homeownership
• Federal policymakers restructure both agencies.
“We need to change the system,” said Rep. Gregory Meeks (D-New York), who hosted the session. “We need to wreck the car and buy the house.”