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Increased Black Home Ownership Would Slice Wealth Gap

Published

11 years ago

March 18, 2015

In this Oct. 27, 2014 photo, a realty sign is posted in front of a home for sale in Carlsbad, Calif. Real estate date provider CoreLogic releases its September report on U.S. home prices on Tuesday, Nov. 4, 2014. (AP Photo/Lenny Ignelzi)

In this Oct. 27, 2014 photo, a realty sign is posted in front of a home for sale in Carlsbad, Calif. (AP Photo/Lenny Ignelzi)

by Freddie Allen
NNPA Senior Washington Correspondent

WASHINGTON (NNPA) – Researchers studying the affects of public policy on the racial wealth gap estimated that the median wealth of Black households would rise 451 percent if Blacks owned homes at the same rates as Whites.

“With policies that advance the rate of Black and Latino homeownership to the same rate as White households, Black median wealth would more than quadruple and Latino media wealth would more than triple,” said Catherine Ruetschlin, a senior policy analyst at Demos, a public policy group that advocates for political and economic equality.

A joint effort by Demos and the Institute on Assets and Social Policy (IASP), a research group that advocates for economic opportunity, security and equity for individuals and families, detailed the key factors in housing, education, and the labor market that have contributed to the racial wealth gap for generations.

The report by said that the median Black household had $7,113 in wealth holdings compared to the median White household, which had $111,146 in wealth holdings in 2011.

“Black households hold only 6 percent of the wealth owned by White households, which amounts to a total wealth gap of $104,033, and Latino households hold only 8 percent of the wealth owned by White households, a wealth gap of $102,798,” stated the report. “In other words, a typical White family owns $15.63 for every $1 owned by a typical Black family and $13.33 for every $1 owned by a typical Latino family.”

According to the report if public policy eliminated racial disparities in income, the median Black wealth would grow $11,488 and if disparities in college graduation rates were eradicated, median Black wealth would grow $1,313.

Thomas Shapiro, the director at IASP, said that the racial wealth gap is one of the most critical issues as the United States moves into the 21st century. Shapiro said that researchers designed a new tool called the “Racial Wealth Audit,” to get a real, objective handle on the impact of policy on wealth accumulation in the United States and what the racial wealth gap really looks like.

Tamara Draut, the vice president of policy and research at Demos, said that while researchers and policy analysts have been heartened by the burgeoning debate surrounding rising inequality in the United States and the implications that it has for all of our standards of living, the underlying racial divide that underpins so much of the inequality in this country is less understood and less talked about.

“In addition, Black and Latino college graduates saw a lower return on their degrees than White graduates: for every $1 in wealth that accrues to median Black households associated with a college degree, median White households accrue $11.49,” stated the report.

Black families also experienced lower returns on the income that they earned, when compared to White families.

“If households of color had the same wealth returns estimated for White families with similar incomes, the racial wealth gap would decrease by 43 percent,” said Tatjana Meschede, the research director at IASP. “To make progress in closing the racial wealth gap, policies need to address both income inequality and differential wealth returns to income.”

Meschede said policy recommendations to address income inequality included raising the minimum wage, the creation of a federal jobs program and increasing unionization.

“Homeownership is the largest reservoir of wealth and financial stability that American families have,” said Thomas Shapiro, the director at IASP. “It’s just that it is so inequitably distributed at this point in time in the value of wealth that it creates.”

With the creation of the Federal Housing Administration in 1934, the United States government sanctioned lenders to use “redlining” to systematically deny Blacks access to that reservoir of wealth for decades.

“While redlining was officially outlawed by the Fair Housing Act of 1968, its impact in the form of residential segregation patterns persists with households of color more likely to live in neighborhoods characterized by higher poverty rates, lower home values, and a declining infrastructure compared to neighborhoods inhabited predominantly by White residents,” stated the report. “Discriminatory lending practices persist to this day. When households of color access mortgages, they are more often underwritten by higher interest rates.”

Draut said that some economists and lawmakers have drawn the wrong conclusions about what happened during the financial collapse and that misunderstanding is preventing faster progress towards the policies that we need.

“We know that lower-income homeowners can afford homes, stay in their homes and not be subject to foreclosure, if they have safe, traditional mortgages,” explained Draut. “The defamation of wealth and the resulting foreclosures were really due to the aggressive marketing and selling of toxic mortgages to communities of color that directly put their homeownership status in danger.”

Shapiro expressed concerns about some of the current conversations taking place on Capitol Hill and at the Treasury Department around financial reforms in the housing industry, adding that some policymakers have floated the idea that prospective buyers should take on more risk, possibly in the form of larger down payments.

“Those are precisely the kinds of reforms that will continue to block families of color from homeownership,” said Shapiro.

In order to close the wealth gap, Ruetschlin said that policies that perpetuate differences in homeownership rates and returns should be changed.

The report recommended stricter enforcement of housing anti-discrimination laws, authorizing Fannie Mae and Freddie Mac to make it easier for struggling homeowners to modify loans and lowering the cap on the mortgage interest tax deduction.

Ruetschlin said that, the investor class and international governments increasingly point to widening inequality as a real threat to economic stability and that the amount of wealth a family holds affects their ability to survive that shock when volatility occurs.

She explained, “Growing inequality can really undermine stability overall and make it even harder for an increasingly large portion of the population to weather those shocks when they come.”

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Oakland Post: Week of December 31, 2025 – January 6, 2026

The printed Weekly Edition of the Oakland Post: Week of – December 31, 2025 – January 6, 2026

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2025 in Review: Seven Questions for Assemblymember Lori Wilson — Advocate for Equity, the Environment, and More

Her rise has also included several historic firsts: she is the only Black woman ever appointed to lead the influential Assembly Transportation Committee, and the first freshman legislator elected Chair of the California Legislative Black Caucus. She has also been a vocal advocate for vulnerable communities, becoming the first California legislator to publicly discuss being the parent of a transgender child — an act of visibility that has helped advanced representation at a time when political tensions related to social issues and culture have intensified.

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Assemblymember Lori D. Wilson (D-Suisun City). File photo.

By Edward Henderson, California Black Media

Assemblymember Lori D. Wilson (D-Suisun City) joined the California Legislature in 2022 after making history as Solano County’s first Black female mayor, bringing with her a track record of fiscal discipline, community investment, and inclusive leadership.

She represents the state’s 11th Assembly District, which spans Solano County and portions of Contra Costa and Sacramento Counties.

California Black Media spoke with Wilson about her successes and disappointments this year and her outlook for 2026.

What stands out as your most important achievement this year?

Getting SB 237 passed in the Assembly. I had the opportunity to co-lead a diverse workgroup of colleagues, spanning a wide range of ideological perspectives on environmental issues.

How did your leadership contribute to improving the lives of Black Californians this year?

The Black Caucus concentrated on the Road to Repair package and prioritized passing a crucial bill that remained incomplete during my time as chair, which establishes a process for identifying descendants of enslaved people for benefit eligibility.

What frustrated you the most this year?

The lack of progress made on getting Prop 4 funds allocated to socially disadvantaged farmers. This delay has real consequences. These farmers have been waiting for essential support that was promised. Watching the process stall, despite the clear need and clear intent of the voters, has been deeply frustrating and reinforces how much work remains to make our systems more responsive and equitable.

What inspired you the most this year?

The resilience of Californians persists despite the unprecedented attacks from the federal government. Watching people stay engaged, hopeful, and determined reminded me why this work matters and why we must continue to protect the rights of every community in our state.

What is one lesson you learned this year that will inform your decision-making next year?

As a legislator, I have the authority to demand answers to my questions — and accept nothing less. That clarity has strengthened my approach to oversight and accountability.

In one word, what is the biggest challenge Black Californians are facing currently?

Affordability and access to quality educational opportunities.

What is the goal you want to achieve most in 2026?

Advance my legislative agenda despite a complex budget environment. The needs across our communities are real, and even in a tight fiscal year, I’m committed to moving forward policies that strengthen safety, expand opportunity, and improve quality of life for the people I represent.

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2025 in Review: Seven Questions for Assemblymember Tina McKinnor, Champion of Reparations, Housing and Workers’ Rights

In 2025, McKinnor pushed forward legislation on renters’ protections, re-entry programs, reparations legislation, and efforts to support Inglewood Unified School District. She spoke with California Black Media about the past year and her work. Here are her responses.

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Assemblymember Tina McKinnor (D-Inglewood). File photo.

By Joe W. Bowers Jr., California Black Media

Assemblymember Tina McKinnor (D-Inglewood) represents

California’s 61st Assembly District.

As a member of the California Legislative Black Caucus (CLBC),

McKinnor was elected in 2022. She chairs the Los Angeles County Legislative Delegation and leads the Assembly Public Employment and Retirement Committee. McKinnor also served as a civic engagement director, managed political campaigns, and worked as chief of staff for former Assemblymembers Steven Bradford and Autumn Burke.

Looking back on 2025, what do you see as your biggest win?

Assembly Bill (AB) 628. If rent is $3,000, people should at least have a stove and a refrigerator. It’s ridiculous that people were renting without basic appliances.

I’m also proud that I was able to secure $8.4 million in the state budget for people coming home from incarceration. That includes the Homecoming Project, the menopause program for incarcerated women, and the Justice Leaders Program.

How did your leadership help make life better for Black Californians this year?

After the Eaton Fire, I pushed to get the same kind of support for affected areas that wealthier regions get after disasters.

I also did a lot of work building political power— establishing the Black Legacy PAC and California for All of Us PAC so we could support Black candidates and educate voters. We also called voters to make sure they understood Prop 50.

People need to understand this: there are only 12 Black legislators in the Capitol. Folks act like we can just walk in and pass reparations, but that’s not how it works.

What frustrated you most this year?

The governor did not have the political will to sign these bills: AB 57 and AB 62. They both passed overwhelmingly in the Assembly and the Senate. We did the work. The only person who didn’t have the political will to sign them was the governor.

The public needs to ask the governor why he didn’t sign the bills. We can’t keep letting people off the hook. He has to answer.

I also introduced AB 51 — the bill to eliminate interest payments on Inglewood Unified School District’s long-standing state loan — held in the Appropriations Committee. That was frustrating,

What inspired you most in 2025?

The civil rights trip to Alabama was life changing. We visited the Legacy Museum and the National Memorial for Peace and Justice. We took members of the Black, Latino, Jewish, and API caucuses with us. It changed all of us.

People aren’t always against us — they just don’t know our history.

What’s one lesson from 2025 that will shape how you approach decisions next year?

The legislative trip to Norway taught me that collaboration matters. Government, labor, and industry sit down together there. They don’t make villains. Everybody doesn’t get everything they want, but they solve problems.

What’s the biggest challenge facing Black Californians in one word?

Inequity. It shows up in housing, wealth, stress – all these things.

What’s the number one goal you want to accomplish in 2026?

Bringing back AB 57 and AB 62, and securing money for the Inglewood Unified loan interest forgiveness.