Black Homeownership Is Experiencing The Smallest Wealth Gains

By Earlene Greene

  • Black homeowners experienced the smallest wealth gains among any other racial or ethnic group, accumulating $115,000 in wealth in the last decade
  • Black homeownership stands at only 44%, only increasing 0.4% in the last 10 years

Overcoming the challenge of devalued properties in predominantly Black and affordable neighborhoods requires new strategies for building wealth. A new study from the National Association of Realtors indicates that it remains harder for Black homeowners to achieve the same wealth gains in homeownership that other groups do. Furthermore, they experienced the smallest wealth gains among any other racial or ethnic group, accumulating only $115,000 in housing wealth in the last decade. 

Why This Matters: Homes located in majority-Black neighborhoods have been chronically undervalued, further exacerbating the racial wealth gap. Black Americans own homes that are less expensive by nearly $64,000 than homes that White Americans own. 

While the U.S. homeownership rate increased to 65.5% in 2021, the rate among Black Americans lags significantly (44%), has only increased 0.4% in the last 10 years and is nearly 29 percentage points less than White Americans (72.7%), representing the largest Black-White homeownership rate gap in a decade.

Black families often buy lower-valued homes located in neighborhoods that experience less price appreciation. In 2015, the median non-Hispanic white homeowner had $100,000 of home equity (home value less outstanding mortgage balance). The median Black homeowner had slightly more than half that much equity, at $56,000.

Situational Awareness: Having to overcome systemic racist policies, Jim Crow segregation, and redlining, we acquired the right to buy homes after the signing of the 1968 Fair Housing Act. Today, the struggle continues, as the U.S. has primarily relied on homeownership since the mid-20th century for middle-income households to build wealth.  

If you can’t beat them, join them. This phrase comes to mind when considering how Black homeownership still lags behind in wealth accumulation when compared to other groups. Perhaps an effective strategy may be to invest individually and/or collectively in properties located in higher income areas where home appreciation gains are substantially more than other areas. 

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