VOL. 132 | NO. 66 | Monday, April 3, 2017
African-American Homeownership Rates Remain Low Despite Strong Housing Market
By Patrick Lantrip
With average home sales prices recently hitting an all-time high, it’s easy to get excited about the future of Memphis’ housing market.
Despite a healthy overall housing market, homeownership rates among African-Americans remain 20 points below the national average.
(Daily News File/Andrew J. Breig)
However, even as the city seems poised to move forward and finally shake off the last vestiges of the Great Recession, there is one piece to the puzzle that is missing in a big way.
While homeownership rates across the board are at a 30-year low, African-American homeowners remain 20 points below the average, according to data compiled by the U.S. Census Bureau.
Those same figures show that, while homeownership rates for non-Hispanic whites is more than 72 percent, for African-American households, that number is lower than 42 percent.
With an estimated 16.4 million African-American households in the U.S. in 2015, a 41.5 percent homeownership rate would equal 6.8 million African-American homeowners. If that figure was adjusted to the 72.1 percent homeownership rate of non-Hispanic whites, there would be 11.8 million African American homeowners – an increase of 5 million, according to the National Association of Real Estate Brokers’ State of Housing in Black America 2016 report.
Using Census data and other figures, the report also found that the addition of 5 million homeowners at an average home price of $250,000 would equal a $1.25 trillion increase in African-American wealth accumulation.
“It’s just a combination of things that are issues within our community in regards to homeownership,” said William Mitchell, a long-time Crye-Leike Realtor who works with the NAREB and a number of local community organizations. “I’m not trying to say that it’s a horrible thing, it’s so much better than it was five years ago, but we’re just slowing inching there.”
Which is why NAREB recently launched a 2 Million New Black Homeowners initiative designed to increase the number of African-American homeowners by 2 million over the next five years.
“This homeownership issue is a national promotion making sure that the African-American population understands the benefits of homeownership and trying to work toward owning your own home,” Mitchell said.
Using the data compiled by NAREB, if this program were to meet its 2 million goal, it would equate to a $500 billion increase in accumulated African-American wealth.
Programs like this are especially important in Memphis, because according to NAREB’s data, Memphis has the fifth-largest population of African-Americans in the U.S. – only trailing New York, Chicago, Philadelphia, Detroit and Houston – with a population of 429,604. That represents 65 percent of Memphis’ population, the second-highest on the list.
The Frayser Community Development Corp., which was founded in 2000 to become a revitalization engine for the North Memphis area, has an ongoing marketing campaign to build homeownership in a traditionally African-American community that has seen better days.
While the campaign is not exclusively aimed at African-Americans, Frayser CDC executive director Steve Lockwood said Frayser is roughly 84 percent African-American and was one of the hardest-hit areas of Memphis during the recession.
“After languishing for a long time, the (home) prices are going up rapidly here,” Lockwood said. “Now they are still very low, so it’s a good time to buy. If it were a stock, it would be underpriced and it would go fast.”
The campaign to raise awareness of homeownership opportunities in Frayser is centered on billboard and radio spots using the slogan, “Why rent for $700 when you can own for $480.” The campaign was made possible by a grant from the Hyde Foundations.
“The final piece of work we will be obligated to do is get together with a least six other neighborhoods and try to teach them how to do this,” Lockwood said. “Because what we are doing is not all specific to Frayser.”
Visit fraysercdc.org for more information on the Frayser CDC’s efforts.