NAHB, NAACP Hope to Shrink Minority Homeownership Gap
With the release last week of a joint housing policy report assessing the state of minority housing and barriers to housing choice and affordability, the NAACP and NAHB laid the groundwork for a cooperative effort to close the gap between homeownership rates for African Americans and the general U.S. population.
The report, “Building on a Dream,” includes Census statistics on housing affordability in the 25 largest metropolitan areas for minority wage earners in selected occupations and concludes with a series of joint policy recommendations designed to improve minority housing opportunity.
“Owning a home is the foundation of prosperity and conveys to families many social and economic benefits,” said NAACP President & CEO Bruce S. Gordon. “Yet for minority families, African American families in particular, great variances remain in homeownership rates and affordable housing opportunities. It is time to bridge that gap. The NAACP and NAHB have chosen to make a difference, one family at a time, one community at a time.”
“For far too long, the dream of homeownership has eluded too many of America’s minority families. It is time to take action,” said NAHB President David Pressly. “Working together, the NAACP and NAHB have identified opportunities for change and steps we can take to open doors for all Americans.”
"At NAHB, we recognize that as America becomes more diverse, we must reach out to other organizations to help us make progress," added Jerry Howard, NAHB executive vice president and CEO. "That's the spirit behind this report, and that's the spirit behind our partnership with the NAACP."
The report notes that despite recent gains for African American households, their homeownership rate falls 20% below the national average. Half of all African Americans live in unaffordable, inadequate or crowded housing. A shortage of workforce housing in many metro areas creates especially severe problems for minorities, even those employed in key community support occupations, such as police officers, teachers, firefighters and healthcare workers.
In the 25 metro areas included in the study, “there are a little over 20 million owner-occupied housing units in roughly 21,000 Census tracts,” the report says. “The number of tracts that are affordable for the minority workforce ranges from a high of 6,400 for minority teachers down to 250 for minority workers in retail sales. The number of owner-occupied homes in the affordable tracts ranges from 5.9 million for minority teachers to about 140,000 for minority sales workers.”
In Minneapolis-St. Paul, for example, there are few Census tracts with affordable housing for minority teachers. The few places that are affordable for them tend to lie in the least expensive parts of the inner city, and in the exurban fringe, which is far from most jobs. This is a typical pattern for the nation’s big cities. Since the affordable tracts are older, the report says, it also seems reasonable to infer that these neighborhoods have a disproportionate share of deteriorated and unusable homes, although this can’t be demonstrated conclusively by government data.
The tradeoff for essential minority workers is commuting longer distances, an increasingly prohibitive option when gas prices are as high as they are today, or finding less desirable homes closer in, the report says. And despite federal laws to eliminate discrimination in the housing search, “minorities in general, and African Americans in particular, have higher mortgage rejection rates, are more likely to get sub-prime loans and are more susceptible to geographic steering by housing agents.”
The report assesses some of the barriers to housing choice and affordability for minority families. The barriers include:
- A lack of home buyer education for minorities
- Excessive development regulations that drive up the cost of housing
- Predatory lending practices that increase the cost of mortgages and the risk of default
- Restrictions on multifamily housing that diminish the supply of moderately priced for-sale and rental housing
- Fair Housing Act violations that diminish minority families’ access to quality housing in many neighborhoods
“The segregation that exists today comes not so much from active choices made by families, but from limits on housing and community choice that result from government land-use and community investment policies,” the report says.
In the effort to address the barriers and to improve minority housing opportunity, the NAACP and NAHB have developed a set of nine policy recommendations and related action steps. The two organizations will be working to encourage public and private institutions to establish policies that increase the supply of affordable housing and address the particular issues that make it harder for minorities to find a decent and affordable home.
The NAACP and NAHB are jointly recommending policies that will:
- Provide comprehensive home-buyer education developed and promoted by public and private housing market participants
- Eliminate predatory lending practices by better defining such practices and encouraging federal banking regulators to develop and enforce stringent anti-predatory lending regulations
- Prevent racial discrimination through increased federal, state and local enforcement of the nation’s Fair Housing laws and education about those laws. Participants in the housing market must be aware of their responsibilities under the Fair Housing Act.
- Ensure that state and local regulatory activities do not — regardless of intent — violate the Fair Housing Act by disproportionately pricing minorities out of the housing market
- Encourage local planning and zoning boards to accommodate a range of housing types that meet the needs of families across the economic spectrum and to acknowledge the importance of housing opportunity in their decision-making
- Encourage government legislators, regulators and administrators to remove and avoid lengthy and costly approval processes and excessive development standards that unnecessarily drive up the cost of housing
- Increase funding for federal housing programs, such as HOME, Section 8 rental assistance vouchers and Community Development Block Grants, in order to keep pace with the growing gap between incomes and rising housing costs
- Maintain all existing housing preferences in the federal tax code, including the mortgage interest deduction, the Low Income Housing Tax Credit and deductions for residential property taxes
- Promote the production of new affordable housing by educating public and private stakeholders that affordable housing is a necessary and desirable part of their communities
In additional to the report, the NAACP and NAHB are engaged in joint litigation in Texas to stop one city from imposing exclusionary development regulations that would push the cost of housing beyond the means of many families, in violation of the Fair Housing Act.
For more information, e-mail Blake Smith at NAHB, or call him at 800-368-5242 x8583.
Photos by Herman Farrer