“ This gap is, at least in part, a function of decades-old policies that segregated Americans based on race and national origin. ”
The disparity has significant implications, given that homeownership is crucial to building wealth and financial security. We must bridge the gap. Doing so will take the best efforts of U.S. policymakers, real estate industry leaders, housing experts and the millions of people who contribute to making homeownership a reality for countless families across the country.
Indeed, when White veterans returned home from World War II, they were welcomed with low-cost homes in new suburban subdivisions financed by the federal government, while returning Black veterans were barred from these same communities through federal mandates. This crisis is largely driven by restrictive zoning laws that ban smaller lot sizes and denser, often more affordable housing units from being developed — pushing prices out of reach for those looking to become homeowners, especially people who cannot rely upon generational wealth for a down payment.
At the same time, policymakers must ensure that prospective Black homebuyers have equitable access to financing for home purchases. After all, saving for a down payment is one of the primary obstacles to homebuying. While many first-time buyers rely on family members for assistance, young Black adults are less likely to have homeowning relatives who possess the wealth required to provide such support.
Congress can incentivize localities to implement these reforms by establishing a competitive grant program to encourage communities to take active steps to remove barriers to new and affordable housing, including those that prevent the construction of new housing via outdated zoning or land use regulations. ‘