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Erasing the Wealth of African Americans

Nous

Well-Known Member
Premium Member
According to a study conducted by Andre Perry, Jonathan Rothwell and David Harshbarger for the Brookings Institute, homes in majority-Black neighborhoods are valued at about half the price as comparable homes in neighborhoods with no Black homeowners. Differences in the structural features of the properties and neighborhood characteristics--such as higher crime rates, longer commute times, less access to desirable schools, and fewer well-rated restaurants--account for only about half of the undervaluation of homes in Black neighborhoods. Overall, owner-occupied homes in majority-Black neighborhoods are undervalued by $48,000 per home on average, amounting to $156 billion in lost wealth for these families--most of whom are Black.

As the report notes, this diminution of property values results in lower wealth accumulation for homeowners in these neighborhoods, which creates a self-perpetuating cycle where it is then more difficult for these property owners to start businesses, afford college tuition for their children, etc., etc.

Read the report: The Devaluation of Assets in Black Neighborhoods

(Like I was, you will probably be surprised by some of the metro areas with the most devalued homes in Black neighborhoods, as well as some of the cities with the least devalued homes.)

This is a very sad problem, an otherwise invisible but quite destructive privation inflicted upon African Americans. So what is the solution to this problem?
 

Revoltingest

Pragmatic Libertarian
Premium Member
Is this really "erasing" or was the value less than other neighborhoods to begin with?
I also question how "undervalue" is determined...something other than actual sales?
 

Thief

Rogue Theologian
According to a study conducted by Andre Perry, Jonathan Rothwell and David Harshbarger for the Brookings Institute, homes in majority-Black neighborhoods are valued at about half the price as comparable homes in neighborhoods with no Black homeowners. Differences in the structural features of the properties and neighborhood characteristics--such as higher crime rates, longer commute times, less access to desirable schools, and fewer well-rated restaurants--account for only about half of the undervaluation of homes in Black neighborhoods. Overall, owner-occupied homes in majority-Black neighborhoods are undervalued by $48,000 per home on average, amounting to $156 billion in lost wealth for these families--most of whom are Black.

As the report notes, this diminution of property values results in lower wealth accumulation for homeowners in these neighborhoods, which creates a self-perpetuating cycle where it is then more difficult for these property owners to start businesses, afford college tuition for their children, etc., etc.

Read the report: The Devaluation of Assets in Black Neighborhoods

(Like I was, you will probably be surprised by some of the metro areas with the most devalued homes in Black neighborhoods, as well as some of the cities with the least devalued homes.)

This is a very sad problem, an otherwise invisible but quite destructive privation inflicted upon African Americans. So what is the solution to this problem?
I grew up in a housing project of a mid-size city

I left

and some years later the city tore it all down

in the place I resettled........a carbon copy of the same housing project

and some years passed.....and that city tore it down

we still have a housing project out east side......
no white people go there anymore
 

YmirGF

Bodhisattva in Recovery
According to a study conducted by Andre Perry, Jonathan Rothwell and David Harshbarger for the Brookings Institute, homes in majority-Black neighborhoods are valued at about half the price as comparable homes in neighborhoods with no Black homeowners. Differences in the structural features of the properties and neighborhood characteristics--such as higher crime rates, longer commute times, less access to desirable schools, and fewer well-rated restaurants--account for only about half of the undervaluation of homes in Black neighborhoods. Overall, owner-occupied homes in majority-Black neighborhoods are undervalued by $48,000 per home on average, amounting to $156 billion in lost wealth for these families--most of whom are Black.

As the report notes, this diminution of property values results in lower wealth accumulation for homeowners in these neighborhoods, which creates a self-perpetuating cycle where it is then more difficult for these property owners to start businesses, afford college tuition for their children, etc., etc.

Read the report: The Devaluation of Assets in Black Neighborhoods

(Like I was, you will probably be surprised by some of the metro areas with the most devalued homes in Black neighborhoods, as well as some of the cities with the least devalued homes.)

This is a very sad problem, an otherwise invisible but quite destructive privation inflicted upon African Americans. So what is the solution to this problem?
I have a sneaking suspicion that race has nothing to do with this and that it is merely a "feature" of living in a depressed area. Yeah, if you are in a depressed area, it is very hard to get out via anything but a clean break. Opportunities generally do not grace the disenfranchised and so we should not be shocked that they are not starting new businesses. I would predict you would find similar disparities across racial lines in virtually any poorer neighborhoods. It is sort of the reason people like to live in a nice area....

This equality of outcomes nonsense has to stop now.
 

Revoltingest

Pragmatic Libertarian
Premium Member
I have a sneaking suspicion that race has nothing to do with this and that it is merely a "feature" of living in a depressed area. Yeah, if you are in a depressed area, it is very hard to get out via anything but a clean break. Opportunities generally do not grace the disenfranchised and so we should not be shocked that they are not starting new businesses. I would predict you would find similar disparities across racial lines in virtually any poorer neighborhoods. It is sort of the reason people like to live in a nice area....

This equality of outcomes nonsense has to stop now.
The solution is clear.
When black folk buy homes, they should pay more.
Then real estate appraisers will see every home as
more valuable, thus increasing wealth.
 

sun rise

The world is on fire
Premium Member
Is this really "erasing" or was the value less than other neighborhoods to begin with?
I also question how "undervalue" is determined...something other than actual sales?
That is answered in the provided link. You have only to click on it.
 

YmirGF

Bodhisattva in Recovery
The solution is clear.
When black folk buy homes, they should pay more.
Then real estate appraisers will see every home as
more valuable, thus increasing wealth.
What could go wrong?

It's not like the government would order lending institutions to make loans to anyone who could fog a mirror.
 

metis

aged ecumenical anthropologist
Poverty negatively affects societies in so many different ways, and those who grow up in poverty often lose hope. And when people lose hope, watch out because almost anything can then happen.
 

Cooky

Veteran Member
I grew up in a housing project of a mid-size city

I left

and some years later the city tore it all down

in the place I resettled........a carbon copy of the same housing project

and some years passed.....and that city tore it down

we still have a housing project out east side......
no white people go there anymore

I remember Cabrini Green.
 

Shadow Link

Active Member
Call him what?
IMG_2248.JPG
 

Nous

Well-Known Member
Premium Member
Is this really "erasing" or was the value less than other neighborhoods to begin with?
What (or when) do you mean by the term "to begin with"? The study did not adjust for any such concept as the value of any property "to begin with".

The report describes the methodology used. These are the factors that were adjusted for:

Structural Characteristics

• Median bedrooms
• Median year built
• Single family detached share of owner-occupied units
• Single family attached share of owner-occupied units
• Mobile homes share of owner-occupied units
• Share of homes with no vehicle availability
• Share of homes with gas or electric heating
• Share of homes with kitchen

Neighborhood Amenities

• Mean commute of working adults
• Percent of working adults who carpool to work
• Percent of working adults who use public transportation
• Percent of units that are owner-occupied
• Population (natural log)
• Share of households with children under 18
• Share of households headed by single moms
• Median age of population
• EPA Walkability Index
• Number of professional service businesses
• Number of libraries
• Number of museums and historical sites
• Number of food and drinking places
• Number of gas stations
• Proficiency rate of 4th-8th grade public school students

And, as noted in the OP, adjusting for these factors only accounted for about half of the difference in house values between majority-Black neighborhoods and neighborhoods with no Blacks.
 

Revoltingest

Pragmatic Libertarian
Premium Member
What (or when) do you mean by the term "to begin with"? The study did not adjust for any such concept as the value of any property "to begin with".

The report describes the methodology used. These are the factors that were adjusted for:
If black folk who are poor would be expected to move into a neighborhood with low priced
housing. This low valued housing would continue to remain low relative to other housing.
Even gentrification wouldn't prevent this situation, as black folk move out to other areas.
Structural Characteristics

• Median bedrooms
• Median year built
• Single family detached share of owner-occupied units
• Single family attached share of owner-occupied units
• Mobile homes share of owner-occupied units
• Share of homes with no vehicle availability
• Share of homes with gas or electric heating
• Share of homes with kitchen

Neighborhood Amenities

• Mean commute of working adults
• Percent of working adults who carpool to work
• Percent of working adults who use public transportation
• Percent of units that are owner-occupied
• Population (natural log)
• Share of households with children under 18
• Share of households headed by single moms
• Median age of population
• EPA Walkability Index
• Number of professional service businesses
• Number of libraries
• Number of museums and historical sites
• Number of food and drinking places
• Number of gas stations
• Proficiency rate of 4th-8th grade public school students

And, as noted in the OP, adjusting for these factors only accounted for about half of the difference in house values between majority-Black neighborhoods and neighborhoods with no Blacks.
The criteria shown say nothing about change over time.
Yet "erasing" is a term which indicates change.
 

Nous

Well-Known Member
Premium Member
I have a sneaking suspicion that race has nothing to do with this and that it is merely a "feature" of living in a depressed area.
Define "depressed area".

Notice that several of the "neighborhood amenities" that were adjusted for in the study are the product of the neighborhood consisting of residential properties with a lower value than non-Black neighborhoods.

This equality of outcomes nonsense has to stop now.
Wouldn't you be a little peed-off and think it unfair to find your home undervalued merely because of the color of skin and the color of the majority of your neighbors?
 

Revoltingest

Pragmatic Libertarian
Premium Member
Define "depressed area".

Notice that several of the "neighborhood amenities" that were adjusted for in the study are the product of the neighborhood consisting of residential properties with a lower value than non-Black neighborhoods.

Wouldn't you be a little peed-off and think it unfair to find your home undervalued merely because of the color of skin and the color of the majority of your neighbors?
An over-valued home means one is paying higher real estate
taxes than one should also. I've spent tens of thousands fighting
illegally high appraisals. Be careful what you wish for.

What would you change in the real estate appraisal process...
....for both licensed appraisers & for government appraisers?
 

Nous

Well-Known Member
Premium Member
If black folk who are poor would be expected to move into a neighborhood with low priced
housing. This low valued housing would continue to remain low relative to other housing.
Even gentrification wouldn't prevent this situation, as black folk move out to other areas.
???? I asked you what (or when) you mean by the term "to begin with". I don't have a clue how your response is supposed to answer the question.

The criteria shown say nothing about change over time.
Yet "erasing" is a term which indicates change.
Erase:

7. to give way to effacement readily or easily.
8. to obliterate characters, letters, markings, etc., from something.​

"Erasing" is merely a term I used in the thread title only in order to avoid repeating the title of topic study. The authors of the study did not use "erase" in any form at any point. It's a cross-sectional study. It certainly does not imply that property values do not change over time.
 
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