April is National Fair Housing Month and Coldwell Banker is speaking with Lydia Pope, President of the National Association of Real Estate Brokers (NAREB) while she shares the initiatives the organization is investing in to address unfair housing issues.

Housing inequalities, a growing wealth gap in the United States, and a lack of resources among disenfranchised communities are major restrictions preventing an increase in Black homeownership. To ensure that people of color have equal access to homeownership, NAREB is prioritizing several initiatives including shrinking racial inequalities and financial hurdles.

Gehringer: What is the current state of fair housing?

Pope: While we’ve made great strides in creating equal opportunities to homeownership, there remains a lot of room for growth. Marginalized communities continue to face racial inequalities and lack access to the same resources that their white counterparts are afforded in the search of their dream home. NAREB is hoping to bring awareness to these issues to help tackle them and guide people through them.

Gehringer: To what extent have Black Americans been impacted by housing and wealth inequalities?

Pope: Homeownership for the Black community has declined nearly 20% since 2008. Despite the enactment of the 1968 Fair Housing Act, which was designed to offer legal protections from housing discrimination, the homeownership gap continues to expand further disenfranchising the most marginalized. In 1960, 38% of Black Americans owned homes while White homeownership was at 65%, a 27-point gap. Forward to 2021 and the United States has experienced the largest homeownership spread since 1890 with 44.6% of Black Americans owning a home and 74.2% for Whites, a 29.6-point gap.

Gehringer: Are there any dynamics and obstacles impacting Black homeownership?

Pope: It is evident that blatant, race-related barriers are hindering the expansion of Black wealth in America. The average white family possesses eight times the wealth of a Black family of similar stature. The median net worth for Black households is $24,000 compared to $188,000 for White families. The cycle can only be broken by improving the major driver of Black wealth – intergenerational homeownership that yields prosperity and family economic security.

America’s public and private sectors claim to be committing to a more equitable society, one with opportunities for wealth and success regardless of race or ethnicity. But to make racial equity a reality, government, corporate and civic leaders must address the wealth and home ownership gaps that diminish the aspirations, hopes, and dreams of Black families and individuals.

For many Black families, one of the biggest hurdles is saving money for the down payment on a house. Their income level may qualify them for a mortgage, but they struggle to come up with the upfront costs. In passing H.R. 5376, the original Build Back Better Act, the House included a $10 billion down payment grant program for first-time, first-generation homebuyers. Options currently exist for down payment assistance, but most come with onerous conditions such as adding a second mortgage or stricter wage and credit score requirements making it harder to qualify for a mortgage. As the Senate pares down H.R. 5376 to attract support needed for passage in reconciliation, it’s critical that the down payment provisions remain in the bill.

Gehringer: How has fair housing progressed over the past few years?

Pope: The Economic Policy Institute has reported that African Americans have made significant advances in educational achievement, health, wealth, and wages since the fair housing act was passed.

President Joe Biden has issued a directive specifically calling on the U.S. Department of Housing and Urban Development (HUD) to undo historic patterns of segregation and other types of discrimination in a manner that affirmatively furthers fair housing. Recently, this department made available over $19.4 million in American Rescue Plan funding to agencies working to address the unequal impact the COVID pandemic has had on communities of color, low-income communities and other vulnerable populations. This funding provides resources and support to victims of housing discrimination and is being used to conduct housing education and outreach activities, as well as address fair housing inquiries, complaints and investigations.

HUD has also endorsed the use of Special Purpose Credit Programs to help address inequities in barriers to credit and homeownership. The Special Purpose Credit Program is a tool that allows banks to meet the specific needs of these historically disadvantaged groups. HUD Secretary Marcia Fudge has asked government agencies, including the Consumer Financial Protection Bureau, Office of the Comptroller of the Currency, Federal Deposit Insurance Corporation, Federal Reserve, Federal Housing Finance Agency and National Credit Union Association to expand homeownership opportunities for those who have been and continue to be systemically excluded from the housing and credit markets.

Gehringer: How is NAREB tackling fair housing issues in 2023?

Pope: To address racial inequalities and financial hurdles faced by Black Americans, NAREB is prioritizing the elimination of loan-level price adjusters and penalty fees for borrowers to access down payment assistance. The organization is also working to expand down payment assistance, especially for first time homebuyers, and is leveraging special purpose credit programs. Lastly, NAREB strives to end discriminatory and abusive appraisal practices and ultimately, aiming to fix the broken and out-of-date finance system in the housing industry.

About Lydia Pope:

Lydia M. Pope has been in the Real Estate Industry since 1995 and is currently President & Female business owner of E & D Realty and Investment Co, Inc., E&D Realty Property Management & New Era Real Estate Group Inc. Lydia is also Current National President of the National Association of Real EstateBrokers, Inc. View her Linkedin Profile here.

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