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November 2021

Groups collaborating to close Black homeownership gap

November 2021

Led by the Coalition for More Housing Choices, a partnership of more than a dozen organizations is collaborating to close the Black-white homeownership gap. Numerically, the goal is to double the Black homeownership rate in the next two decades in the region comprising King, Kitsap, Pierce and Snohomish Counties by adding 3,000 new homeowners each year until 2041.

The participating organizations, including Seattle King County REALTORS┬«, support the objective of increasing and sustaining Black homeownership in the Puget Sound region but recognize such challenges  as supply and demand. Its initial plan states: "People of color cannot access equitable pathways to opportunity, including intergenerational wealth creation due to systemically racist policies and practices."

The introductory statement to its planning document also states: "Aligning interests and resources that focus on equity, infrastructure development, housing production and preservation, and underwriting and lending could lead to doubling the Black homeownership rate in the next couple of decades."

After convening a three-part summit over a six-month period, the organizations involved in the initiative unveiled a seven-point plan, along with a breakdown or preliminary strategic priorities and strategies by focus areas.

The network identified the seven focus areas as:

  1. Marketing and Outreach, which will encompass strategies to connect with the Black population using "trusted brokers" to ascertain interest in homeownership, provide credibility and encouragement, and to proactively share potential opportunities.
  2. Pre- and Post-Purchase Counseling to help potential homeowners overcome barriers associated with student loan debt, credit history and score, and other hurdles, and to also develop programs for prospective purchasers in various stages of the process (e.g., ready, near-ready, and long-term-ready).
  3. Purchase Support/Tools. This would complement pre-purchase counseling and include the creation of various buyer readiness tools and resources and expanded access to down payment assistance programs.
  4. Credit and Lending. The network would strive to modify underwriting and lending practices to address any systemic discrimination while expanding access to appropriate and affordable loans. Additionally, this focus area would incorporate systems for tracking and supporting those are not immediately mortgage-ready.
  5. Housing Production. Participating organizations recognize efforts to identify and prepare buyers could be doomed unless supply is increased. They will strive to create "new and expansive predevelopment and construction financing resources," new partnerships between non- and for-profit developers, and methods for leveraging different forms of conveyance.
  6. Policies and Practices. The objective of this focus area is to enact zoning and regulatory reform policies that meaningfully increase supply and access to affordable entry-level and market-rate homes for first-time homebuyers. Included in this would be zoning that increases housing choices, more predictability in design reviews, Housing Benefit District legislation, and expanded use of tools for subsidized ownership units.
  7. Sustaining Existing Owners to ensure they can retain ownership of their homes and equitably benefit from homeownership as a wealth-building tool. The strategies cover building awareness, relationships, early interventions, access to program assistance, and removal of counterproductive prohibitions to receiving assistance.

 

At the same meeting, two coalition partners provided updates on some of their organizations' activities.

Carla Moreira Strickland, vice president, corporate responsibility at JPMorgan Chase, discussed increasing equitable access to homeownership, emphasizing "community investments ecosystems" and "capital absorption" in underserved communities.

Erica Malone, strategic advisor for homeownership at the city of Seattle, spoke about increasing equitable access to homeownership, notably via city-owned land disposition for affordable housing. Among examples she cited were a project to build row houses and duplexes in Magnolia and the transfer of Sound Transit property to Rainier Valley BIPOC residents. She also discussed available funding to stabilize existing housing, the exploration of funding to create ADUs, and "permanently affordable" housing.

Closing the gap in Black homeownership extends far beyond the Puget Sound region.

According to 3By30, the Black Homeownership Collaborative whose stakeholders include more than 100 housing and civil rights leaders, the rate of Black ownership "has plummeted to levels not seen since segregation in housing was legal:

  • Bringing the Black homeownership rate up to that of white households would require increasing the number of existing Black homeowners by roughly 5 million, an increase of approximately 72%.
  • The homeownership rate for Black households under age 35 is below 15%, less than half the rate for white counterparts.
  • The homeownership rate for Black households age 35-54 is 40.8%, well below the 72% for white households in the same age group.

 

The 3By30 coalition is committed to creating 3 million net new Black homeowners by 2030 through a set of seven "tangible, actionable and scalable steps."

The Collaborative, announced in June at an event at The Cleveland State University, is led by a steering committee of executives from eight organizations, including the National Association of REALTORS® and the National Association of Real Estate Brokers

At the launch event, Bryan Greene, NAR's vice president of policy advocacy, expressed support for the group's ambitious 7-point plan. "We look forward to continuing our work to secure federal and local-level policies which will raise Black homeownership levels, strengthen communities, and improve the American economy." Commenting on the persistent gap in homeownership rates between Black and white Americans, he said it "illustrates how racial inequality in our society translates into wealth inequality."