Erasing the Wealth of African Americans

[Nous]

I am not sure I understand the problem. Do you mean those houses have been losing value over time ?

Did you read the report on the study? It was a cross-sectional study, thus no hypothesis was tested about what happened over time. The authors clearly stated their findings, namely that homes in majority-Black neighborhoods are valued at about half the price as comparable homes in neighborhoods with no Black homeowners, and that 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.

 

[Koldo]

Did you read the report on the study? It was a cross-sectional study, thus no hypothesis was tested about what happened over time. The authors clearly stated their findings, namely that homes in majority-Black neighborhoods are valued at about half the price as comparable homes in neighborhoods with no Black homeowners, and that 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.

But how is that a problem in itself ?
Doesn't it mean that houses are more affordable in black neighborhoods ? Sorry but I still don't understand what is the matter.

 

[Nous]

But how is that a problem in itself ?
Doesn't it mean that houses are more affordable in black neighborhoods ? Sorry but I still don't understand what is the matter.

As the authors of the report explain, the devaluation of the properties on the basis of the skin color of the majority who live in these neighborhoods means that that these homeowners are less able to send their children to college, to start a business, etc. And, as noted, several of the neighborhood characteristics that affect property values are a consequence of the neighborhood being perceived as less desirable due to property values of the neighborhood. The devaluation of assets on the basis of the skin color of the majority who live in the neighborhood sets up a vicious circle where these people are kept as a perpetual underclass.

 

[Koldo]

As the authors of the report explain, the devaluation of the properties on the basis of the skin color of the majority who live in these neighborhoods means that that these homeowners are less able to send their children to college, to start a business, etc. And, as noted, several of the neighborhood characteristics that affect property values are a consequence of the neighborhood being perceived as less desirable due to property values of the neighborhood. The devaluation of assets on the basis of the skin color of the majority who live in the neighborhood sets up a vicious circle where these people are kept as a perpetual underclass.

How is them being unable to send their children to college related to how much their house is worth ? Are you talking about making use of mortgage loans ?

Also, if houses in black neighborhoods were more expensive wouldn't make it harder to purchase a house thus leaving a lot of people homeless ?

 

[Nous]

How is them being unable to send their children to college related to how much their house is worth ? Are you talking about making use of mortgage loans ?

It makes it more difficult to get the loans.

Also, if houses in black neighborhoods were more expensive wouldn't make it harder to purchase a house thus leaving a lot of people homeless ?

I know of no evidence that assessing the value of properties on the basis of the skin color of the majority who lives in the neighborhood reduces homelessness among that group.

 

[Koldo]

It makes it more difficult to get the loans.

I know of no evidence that assessing the value of properties on the basis of the skin color of the majority who lives in the neighborhood reduces homelessness among that group.

Is that all of it ? Not being able to get mortgage loans ? Thus not being able to put your house at risk ? A practice that I abhor ?

Do you not see the relationship between the affordability of houses and homelessness ?

 

[Revoltingest]

Is that all of it ? Not being able to get mortgage loans ? Putting your house at risk ? A practice that I abhor ?

Do you not see the relationship between the affordability of houses and homelessness ?

I was once a licensed real estate broker. I know this market.
One thing which made loans harder to get was the amount of loan needed.
If one buys a more expensive home (ie, a higher value), then one's loan to value
ratio (LTV) increases, making it harder to qualify & more expensive to borrow.
If black folk faced higher valuations for a given home, there'd be a tendency
to not buy that one. Buy a cheaper one, or just rent?
Is this a good result...making homes less available by altering the appraisal
methods to deem them being worth more? This doesn't increase wealth.
Current (private sector) methods of real estate appraisal are quite functional.
(Government methods are a mess though...either over or under valuing
because of greed or legal restrictions.)

 

[Nous]

Is that all of it ? Not being able to get mortgage loans ?

See #43.

 

[Koldo]

See #43.

I am afraid there is nothing else worth commenting on that post.