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The foreclosure crisis did a number on Black wealth because most African Americans had their investments tied up in the housing market. Blacks lost a staggering 53 percent of their assets in the housing bust. And according to Michigan Chronicle, the future possibility of recovery is nowhere in sight.
Contributors on Roland Martin’s NewsOne Now say that the outlook of minority homeownership in America is bleak; more African Americans are choosing to rent instead of buy.
George Curry, Editor-in-Chief of the National Newspaper Publishers Association News Service, told Martin that African Americans lost all the wealth they had accumulated in the past 30 years, thanks to the Great Recession. Ouch! As a result, more minorities are ditching their ambitions of homeownership and becoming renters instead. This is leading to a dearth of affordable housing.
MC points out that an increased interest in constructing luxury, high-end dwellings, as opposed to budget-friendly homes, is contributing to this issue. Forbes can vouch for this argument:
“The fact remains, many large cities are pricing out average incomes. Widespread unaffordability is mostly attributed to a lack of new rental development when compared with the number of new residents in that region.”
MC, quoting the Wall Street Journal, added that the economic downturn is the notorious culprit behind the gloomy future of Black homeownership:
“Last decade’s housing crisis could give way to a new one in which many families lack the incomes or savings needed to buy homes, creating a surge of renters and a shortage of affordable housing… This will have a major impact on wealth building in minority communities where Blacks and Hispanics are being forced into renting as opposed to having the option of becoming an owner of a property.
To put it simply, minorities are on track to be renters, not homeowners, which will chip away at Black American wealth building. Martin points out that Blacks were particularly hurt by the housing crisis because African Americans do not diversify their investment portfolio.
“Between 2010 and 2013, because Whites typically diversify, [their wealth] went up 2.4 percent,” Martin said, citing a 2014 Pew Research Center. “African Americans went down 33.7 percent.”
Marcia Griffin, founder and president of HomeFree-USA, said there is hope if African Americans become better informed in wealth-building. “We have to really focus on our credit, we have to get a little bit of money saved,” she said.
“Just like Black lives matter,” Griffin said, “Black money matters.”
