By Juliet Martinez with additional reporting by Khaleelah Ali Muhammad
A lower percentage of Black Americans own homes now than before the Fair Housing Act was passed in 1968. But resources exist for those who want to become first-time homeowners.
A recent report from the National Community Reinvestment Coalition says during the pandemic, Black homeownership has sunk to a 120-year low. The private mortgage lending market, the report says, does not adequately serve most households of color. NCRC calls on policy makers, community leaders and lenders themselves to “rally around bold new approaches, race-specific goals and performance requirements.”
The NCRC report points out that the gap between white and Black homeownership is worse than it was in 1900, when 27 percentage points separated the two groups. That gap reached 29 percentage points in 2020, when 74% of white families and 45% of Black families owned homes.
In Pittsburgh, the rate of Black homeownership is considerably lower. The 2018 American Community Survey said only 32% of Black families own their homes in the greater Pittsburgh area. The 129-page Inherited Inequality report released last year showed that banks in Pittsburgh are excluding Black families and communities from the housing market. Only 3.5% of home loans went to Black home buyers between 2007 and 2019. Only 6.8% of loans went to Black neighborhoods, according to the report by Parents Against Violence and the Lower Marshall-Shadeland Development Initiative.
A history of legal discrimination
Historians attribute much of the gap between white and Black homeownership to discriminatory policies like excluding Black veterans from GI Bill benefits. Redlining, another form of legal discrimination, intentionally barred Black families from homeownership. The name for this practice comes from maps drawn using red to show communities of color that the Federal Housing Administration refused to insure. This made it nearly impossible for Black families to get approved for mortgages.
Dr. Robert Nelson helped compile a massive online interactive database of the Home Owners Loan Corporation maps. He directs the Digital Scholarship Lab and heads digital engagement at Boatwright Library at the University of Richmond. He told NPR that the federal government once viewed a middle-class neighborhood as “risky” for mortgages if it had even one Black family.
Because of this legal discrimination, Black families and families of color spent the middle decades of the 20th Century largely unable to "avail themselves of what is arguably the most significant route to family and personal wealth-building in the 20th century, which is homeownership," Nelson said.
The redlining practice quickly spread beyond just the FHA so that the whole real estate industry, including brokers and appraisers, essentially united to bar Black families from getting mortgages and buying homes. This remained legal until the passage of the Fair Housing Act in 1968.
The 54 years since the Fair Housing Act passed have not wiped away centuries of inequality. Nor did it address other barriers to becoming a homeowner. Black homeownership has not yet reached parity with that of white people. But here in Pittsburgh, several organizations are working to change that.
Aid for first-time homebuyers and homeowners
The Urban Institute 2019 report, Building Black Homeownership Bridges, recommends making sure that renters and homeownership-ready millennials know about the resources that can help them buy and maintain a home. From affordable home-buying programs to down-payment assistance and help with home repairs, Pittsburgh has resources to support you becoming a first-time homeowner.
Urban Redevelopment Authority
The URA offers down payment and closing cost assistance, and a portfolio of affordable and market-rate homes for sale through URA's affiliate, the Pittsburgh Housing Development Corporation. Learn more at https://www.ura.org/pages/home-buyer-loans.
The Catapult Asset Building program promotes homeownership through trauma-informed financial counseling, pre-purchase homebuyer education workshops, down-payment assistance for eligible Black homebuyers; and post-purchase classes on basic home maintenance, avoiding predatory lending and estate planning. Find out more at https://catapultpittsburgh.org/programs/#assetBuilding. Fill out the form at https://catapultpittsburgh.org/intake-form/ to get started.
Hazelwood Initiative Affordable Homeownership Program
Hazelwood Initiative buys and renovates homes in the neighborhood, then sells them to low- and moderate-income families at affordable prices. The monthly payments on these mortgages are typically in the $500-700 range. Fill out the interest form at https://www.hazelwoodinitiative.org/ahop.
City of Bridges Community Land Trust
CBCLT develops permanently affordable housing to prevent displacement of limited-income Pittsburghers and preserve the character of changing neighborhoods. This year, they will build two duplex homes on Chatsworth Avenue in Hazelwood. Visit https://cityofbridgesclt.org/apply/ to apply.