Ask PolitiFact: Is Homeownership Harder for Black Americans?

When President Joe Biden announced a plan to cancel student loan debt, he noted its intersection with another issue — black and Hispanic homeownership.

Biden said Aug. 24 that many people are ineligible for a mortgage because of student loan debt, and that the burden of student debt is “especially heavy for black and Hispanic borrowers.”

He added, “They don’t own their home to borrow against to pay for their education. And the pandemic has only made it worse.”

Conservative talk show host Dan Bongino questioned Biden’s comments about black Americans during his Aug. 25 podcast, part of which was posted on Facebook the same day.

“Here’s Biden giving his spiel, a bunch of BS yesterday on this student loan program, and invoking black America again, suggesting that if you’re black, it’s harder for you to own a house or you don’t own a house. no home,” Bongino said. “What is this guy talking about?”

Bongino also argued that Biden’s homeownership comments were part of a larger pattern of racist remarks by the president, a talking point among conservatives.

But Bongino’s skepticism about black homeownership is not supported by statistics. In the United States, home ownership for non-Hispanic white Americans is 73.3%, compared to 42.1% for black Americans, according to 2020 figures from USAFacts, a nonpartisan government data initiative.

Barriers to black home ownership are deeply rooted in American history and their effects are still being felt today.

The link between student debt and home ownership

Black Americans have higher student loan balances than white Americans, which affects their ability to qualify for a mortgage, said Dorothy Brown, a law professor at Georgetown University and author of the book “The Whiteness of Wealth”.

On average, black college graduates owe $25,000 more in student loans than white graduates, the Education Data Initiative reported in June.

And even with the new student debt relief plan, the amounts forgiven “may not be enough for you to reduce your … income-to-debt ratio, so that the mortgage lender thinks you’re an attractive borrower,” he said. Brown said.

The Roots of Inequity in Homeownership

Property inequity dates back to the end of slavery in the United States, when black people were excluded from the right to own property, said Rosemary Ndubuizu, assistant professor of African American studies at the University of Georgetown.

Then, in the 1930s, came the practice known as redlining, which largely barred black Americans from applying for home loans. The U.S. government “has ranked different neighborhoods based on the safety of granting mortgages,” according to the Thomson Reuters Foundation.

There were four color classifications: green was considered “best”; blue was “always desirable”; yellow meant the neighborhood was “definitely in decline”; and red was known as “dangerous”.

Neighborhoods classified as red were mostly home to black people, who were denied housing loans because their neighborhoods were deemed “at risk”.

Modern history: discriminatory practices persist

Decades later, in 1968, then-President Lyndon B. Johnson signed into law the Fair Housing Act, which sought to end discrimination based on race and other factors. Although the law prohibits redlining and other forms of discrimination in the housing market, the effects of discriminatory policies persist even today.

For example, Brown said that in the early 2000s, black and Hispanic families were targeted by banks with unfairly expensive mortgages. And the media coverage contains detailed stories about black American homeowners who receive low home appraisals, compared to people of other races.

Forbes reported in 2020 that black homeowners are nearly five times more likely to own a home in a formerly demarcated neighborhood than in a neighborhood that has been demarcated.

It has also led to wealth disparities.

According to Forbes.

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