Why Homeownership Fails to Build Wealth for Black Women – Non Profit News – Nonprofit Quarterly
In the Locked Out: Black Women, Wealth, and Homeownership series, members of Insight Center, Springboard to Opportunities, and several expert co-authors connect the lived experiences, hopes, and dreams of low-income Black women and their perspectives on homeownership to the historic and current policies that fuel our exclusionary housing market—and its impact on health and wellbeing—to advocate for equitable housing solutions for Black women.
Racial and gender wealth inequality is a longstanding American embarrassment. The product of historic policies and practices that blocked Black people from gaining wealth while simultaneously creating pathways to wealth for white Americans, the issue continues to plague our country. In fact, data shows that wealth inequality may actually be worsening today.
At present, in the US, women have accrued only 55 cents of wealth to every dollar a man has, and Black people still only have 17 cents of wealth for every dollar of wealth held by white people. Black women sit at the intersection of racial and gender wealth inequality and, as a result, own 90 percent less wealth than white men. This shocking statistic illustrates our collective failure to accurately diagnose the sources of racial and gender wealth inequality—which in turn fuels our inability to fully address the problem.
One of the biggest obstacles to rectifying this inequity is that, while Black women’s wealth inequality is a systemic issue—and therefore requires large-scale transformation of our systems—our solutions tend to focus on individual strategies. Homeownership is a prime example of how funders and advocates miss the mark when identifying the problem and, in turn, propose false solutions.
Racial justice advocates, including Black women, believe that homeownership will build wealth for Black people because homeownership has been an effective strategy for white wealth building. However, white people were able to build wealth through homeownership because our housing industry was built to benefit them—and only them. The history of anti-Black US housing policies reveals that without system-level change, Black women will never be able to reap the benefits of homeownership as their white peers do.
Armed with intergenerational wealth, white homebuyers often have access to help with down payments and home maintenance that Black families do not, contributing to a Black-white homeownership gap of more than 30 percentage points. This intergenerational racial wealth gap is largely due to the fact that racist policies and practices like redlining—the systematic denial of loans and other financial supports to communities of color, which ensured racially segregated, unequal neighborhoods—and subsidies to white suburbs allowed white people throughout history to gain massive amounts of wealth while blocking Black people from gaining wealth in the same way. The legacy of such practices continues today. According to a 2019 Federal Reserve Survey of …….