Home ownership
Home ownership is a crucial means by which families can accumulate wealth. Over a period of time, homeowners accumulateHome equity
There is a discrepancy in relation to race in terms of housing value. On average, the economic value of Black-owned units is 35% less than similar White-owned units. Thus, on average, Black-owned units sell for 35% less than similar White-owned units. Krivo and Kaufman state that while median home value of White Americans is at least $20,000 more than that of African Americans and Hispanics, these differences are not a result of group differences in length of residences because Asians have the most equity on their homes but have lived in them for the shortest average period. African American and Hispanic mortgage holders are 1.5 to 2.5 times more likely to pay 9% or more on interest. Krivo and Kaufman calculate that the African-American/White gap in mortgage interest rates is 0.39%, which translates to a difference of $5,749 on the median home loan payment of a 30-year mortgage of a $53,882 home. The Hispanic/White gap (0.17%) translates to Hispanics paying $3,441 more on a 30-year mortgage on the median valued Hispanic home loan of $80,000. The authors conclude that the extra money could have been reinvested into wealth accumulation. Krivo and Kaufman also postulate that the types of mortgage loans minorities obtain contributes to the differences in home equity. FHA and VA loans make up one-third or more of primary loans for African Americans and Hispanics, while only 18% for White Americans and 16% for Asians. These loans require lower down payments and cost more than conventional mortgages, which contributes to a slower accumulation of equity. Asians and Hispanics have lower net equity on houses partly because they are youngest on average, but age has only a small effect on the Black-White gap in home equity. Previously owning a home can allow the homeowner to use money from selling the previous home to invest and increase the equity of later housing. Only 30% of African Americans in comparison to 60% of White Americas had previously owned a home. African-Americans, Asians, and Hispanics gain lower home equity returns in comparison to White Americans with increases in income and education.Residential segregation
Residential segregation can be defined as, "physical separation of the residential locations between two groups. In the United States, large discrepancies in poverty and affluence have become geographically and therefore racially concentrated. Much residential segregation resulted from the discriminatory lending practice ofResidential segregation in Detroit
Residential segregation was especially demonstrated during the post-WWI period in metro Detroit, as hundreds of thousands of people migrated to Detroit during the Great Migration due to its need for cheap labor in war industries and shipyards. Detroit's geographical location along waterways allowed it to become an industrial powerhouse with booming shipping and automobile industries. During this time, many blacks migrated from the Jim Crow South to look for new opportunities and work in Detroit, but were unfortunately met with deep-rooted racist ideologies and overall inequality even in this northern city. The institutional barriers in place within housing during the postwar period further marginalized African-Americans in Detroit and strengthened pre-existing ideas of racism and white supremacy. Because many white Detroiters viewed blacks as outsiders that ultimately would devalue their investments in housing and drastically alter their current lifestyles, they were reluctant to allow them to move into their neighborhoods. The Federal Housing Authority's redlining practices reinforced these calls for residential segregation as their policies refused the improvement of black neighborhoods, simply by denying mortgage loans or loans to purchase homes to combat crowding in these black neighborhoods. Blacks were shut out of the private real estate market, with many unable to purchase homes and bankers using federal appraisal policies that unfairly ruled black neighborhoods to be dangerous, risky investments, and were thus able to outright refuse loans to African-Americans. Blacks ended up living in extremely run-down, crowded areas of the city like Black Bottom and Paradise Valley that were radically disinvested and therefore became blighted. These decrypt houses were very poorly maintained and thus had many maintenance issues including problems with running water, fires, and rat infestations – making them unsuitable places to live. Conversely, due to their white privilege and economic security, whites were able to flee the city to live in highly invested and wealthier suburbs on the outskirts of metro Detroit. Their neighborhoods were typically clean and had high housing values, a major source of pride and economic and social prosperity for white residents. Due to housing policies implemented on both local and federal levels, black Detroiters were left with inadequate living conditions in racially segregated communities, as their white counterparts refused the integration of white and black neighborhoods. Detroit's history of racial segregation regarding residency has continued to have an exponential impact on the city, continuing until today. The structural obstacles that blacks faced upon migration to Detroit demonstrates the prevalence and strength of racism and white supremacy, with whites largely believing that they were superior and thus did not want their homes "devalued" and "corrupted" by blacks. The political climate of the postwar period and the residential segregation that blacks faced has played a large role in Detroit's contemporary urban crisis.History of housing discrimination
Legislation
The National Housing Act of 1934
In 1934 the practice ofThe Housing Act of 1937
This piece of legislation occurred during the New Deal era and provided the basis for future public housing programs. This act allowed for the creation of around 160,000 units of public housing. Most of these units were made to alleviate the housing difficulties of the poor and working class suffering from the Great Depression. Additionally, this public housing program allowed for the Federal Housing Authority (FHA) to provide various monetary funds to local housing authorities to aid with the building and development of these units. The first federal public housing projects were legally segregated by race. In some cases, racially diverse neighborhoods were demolished to make way for segregated government housing. Over time, middle-class white residents moved out of public housing, either taking advantage of federally subsidized mortgages in the suburbs, or being actively evicted due to lower income thresholds. Vacancies were filled with lower-income residents, predominantly minorities excluded from other government programs, who faced ongoing racial discrimination and constituted the majority of the poor population at the time.The GI Bill (1944)
At the end ofThe Fair Housing Act (1968)
The overt discriminatory practices of refusal of sale and loans continued unabated until at least 1968, when theNixon's Fair Housing Policy (1971)
During his presidential term, Nixon's federal housing policy undermined the Fair Housing Act. His policy acknowledged that federal law requires nondiscriminatory practices in federal housing matters but did not provide presidential support. Nixon declared that government could not force suburban desegregation or economic/racial integration. In doing so, he secured many suburban votes but further exacerbated the issue of housing inequality by not supporting subsidized housing programs to help desegregation.The Equal Credit Opportunity Act of 1974
TheThe Home Mortgage Disclosure Act of 1975
Like the Equal Credit Opportunity Act of 1974, this piece of legislation was also designed to supplement the Fair Housing Act in specific areas of housing discrimination. This act protected applicants from discrimination through lending institutions by requiring that any financial institution providing federally related mortgage loan disclose data annually. This included reports of the amount and location of loans related to federal housing (by census tract or ZIP code). The purpose of this was to prevent lending discrimination in certain localities.The Community Reinvestment Act of 1977
TheTrends by minority group
Residential segregation is typically measured by evenness and exposure. Evenness is defined as the relative dispersion of a certain racial group in a metropolitan area whereas exposure is defined as how much a member of a certain racial group is exposed to a member of another racial group. In general, the number of integrated neighborhoods have continued to increase since the passing of the Fair Housing Act in 1968. In addition, the number of exclusively white neighborhoods have been decreasing. Although there has been an increase of a minority population presence in suburbs, residential segregation continues to persist. On average, it is more likely for minority groups to be exposed to mixed neighborhoods than white populations. Residential segregation is not limited to the private housing market. Discriminatory practices also take place within the federal public housing system.African American
Overall, in the period from 1980 to 2000, residential segregation between the black and white population has decreased at a greater rate than other minority groups. However, the African American population, currently the second largest minority group in the United States, still experiences the greatest residential segregation compared to other minority groups. The older industrial cities of the Midwest and Northeast, experience the highest levels of black-white residential segregation, while the newer metropolitan areas of the South are experiences lesser levels of black-white residential segregation. The presence of a black population in the suburbs continues to increase with 40% of African Americans currently living in the suburbs.Latino
Due toAsian
Asians in the United States are a diverse group with a complex historical background. Chinese Americans first came to the United States in the mid-1800s during theSenior
The Fair Housing Act of 1968 and the Housing for Older Persons Act of 1995 allow residential communities to restrict residency to the senior. These communities are set up to accommodate older individuals who dislike having young residents as neighbors.Causes
Neighborhood disinvestment
Neighborhood disinvestment is a systematic withdrawal of capital and neglect of public services by the city. Public services may include schools; building, street, and park maintenance; garbage collection and transportation. Absentee landlordism and mortgage redlining also characterize disinvestment. As redlining prevents households from owning, they have no choice but to rent from landlords that neglect property and charge high rent. These factors allow the devalorization cycle to occur in a neighborhood, eventually leading to the reclamation and transformation of the neighborhood, uprooting the poor residents who have no equity to use for relocation. A deeper look into disinvestment in the community can be termed devalorization. This is when neighborhood decline is analyzed by emphasizing the profit taking of realtors, bankers, and speculators which systematically reduces the worth or value of housing. The devalorization of a neighborhood begins to occur when the city decides to begin disinvesting in it, and the disproportionate influx of minorities shift the neighborhood from mostly live-in owners to absentee landlords. These landlords buy up the houses during white flight from the neighborhood and rent them to the minorities moving in for a high price. In Albina, this process was shown through intensive white flight from the neighborhood, and large redevelopment projects that destroyed the heart of the African American community for the remodeling of a veteran's hospital. This project relocated many African Americans into an even smaller area, creating an overcrowded, volatile environment. Most of the community that survived did not own their homes, and the absentee landlords neglected to make repairs on their properties. The relocation of so many African Americans from southern Albina because of the hospital project caused more white flight on the northern side of Albina, creating more opportunities for landlords use the tactic ofReal-estate discrimination
There is an existence of a dual housing market that results in unequal housing opportunities for different populations of people. The basis of the dual housing market model is that similar housing opportunities are available to different racial groups at different prices. There are many explanations for the existence of a dual housing market. One theory explains the dual housing market through racial steering. This occurs when real estate brokers steer their clients to specific geographic locations of available housing based on race. Although racial discrimination in housing market processes is outlawed by several court decisions and legislation, there is evidence that it still occurs. For example, an HUD Housing Market Practice survey found that African Americans felt discriminated against in the renting and/or buying process of housing. Institutional factors, such as realtor agencies withholding housing information or financial institutions denying mortgages, further perpetuate the effects of the dual housing market model. Another explanation of the existence of a dual housing market is the availability of housing units, either for sale or for rent, for minority groups. Oftentimes, price discriminations results from price fluctuations of property based on the existing demographic of residence in a neighborhood. Racial preference affects the available geographic spaces open to certain minority groups. For example, African Americans are disproportionately found in a small distribution of suburban communities.Socioeconomic status
One theory of the cause of residential segregation is the difference in income between minority groups and their white counterparts. The basis of this theory stems from purchasing power: the higher the income, the more likely minority groups are to move to better neighborhoods which in turn results in more integrated neighborhoods. In other words, there seems to be an inverse relationship between a minority group's socioeconomic status and the minority group's level of residential segregation. Many argue that residential segregation occurs because minority groups, particularly immigrants, do not have the wealth or income to purchase homes in more affluent and predominantly white neighborhoods. Although there is a definite relationship between socioeconomic status and residential segregation, the effect of this relationship is different among minority groups. In terms of location, poverty-stricken communities tend to reside in the inner cities while affluent communities tend to reside in the suburbs. In addition, better neighborhoods contain better educational services and easier access to various occupations. This spatial and economic segregation further perpetuates residential segregation. Across all minority groups, there is a residential gap based on income. Residential segregation between the rich and the poor, occurring at different rates, takes place across the board. African Americans and Latinos, compared to their white counterpart, experience a greater difference in income, education, and occupation levels. On the other hand, Asians experience a lesser difference in terms of income, education, and occupation levels when compared to their white counterpart. These factors, education and occupation, influence income and purchasing power of an individual. For African Americans, Asians, and Latinos, higher income resulted in less segregation from their white counterpart whereas lower income resulted in greater segregation from their white counterpart. However, that an increase in socioeconomic status resulted in a greater decrease in segregation for Latinos and Asians and a lesser decrease in segregation for African Americans suggests that socioeconomic status alone cannot explain residential segregation.Spatial assimilation and immigration
Recent reforms and policies onEffects
Relocation
Once their old neighborhood has been gentrified, many of the residents are forced to relocate, if they have not already done so. When hunting for a new residence, African Americans will more than likely encounter discrimination on some level. Audits performed by the US Department of Housing and Urban Development and a later Housing Development Study suggest that if realtors have a chance to discriminate, they usually do. These studies analyzed the number of cases where whites were given more information about available units or financing options or shown extra units in proportion to African Americans. The results showed that whites were systematically favored for both rental and sales units throughout metropolitan areas in the United States. Racial steering was also taken into account during these audits, and it was shown through the results that African Americans were shown homes in areas that had more minorities, lower home values, or lower median incomes that the homes that were shown to European Americans, even if their economic position was the same. It was shown that about one in every three encounters, African Americans were systematically steered to these non-European American neighborhoods. This segregation is not self-imposed. That is, African Americans do not prefer to live in neighborhoods that are overwhelmingly Black. Survey evidence from a Detroit Area Survey from 1976 shows that African Americans strongly favor the desegregation of the United States, with the overall ideal neighborhood being 50% black and 50% white. Whites, on the other hand, favor neighborhood composition that is dominated by whites. In the same survey, about one-quarter of the whites surveyed said they would feel uncomfortable if their neighborhood exceeded 8% Black. Once the neighborhood reached 21% Black, almost half of the whites surveyed said they would feel uncomfortable.Unequal living standards
Behavioral effects
One of the important social effects on the individual that results from residential segregation is the influence on behavior. Segregated communities tend to slow the rate of assimilation, especially in the ability to speak English, which is considered a primary aspect of assimilating in the United States. The ability to speak English has been shown to result in the increased rate of desegregation in communities. Another behavioral influence of residential segregation is the effect on social networks created. Friendships and marriages tend to occur at a higher probability among people living in close proximities. In other words, people who are spatially separate are less likely to form lasting relationships. A negative behavioral influence of residential segregation is the perpetuation of violence. Specifically with gang activity, the higher the level of segregation, the greater the density of altercations between rival gangs.Health
Many studies have shown that racial or ethnic minority neighborhoods are disproportionally affected by health issues related to the environment, such as a lack of healthy food options, a lack of available pharmacies, and an increased number of advertisements for alcohol and tobacco. In addition, there has been a trend over the past few years of a concentration of ethnic minorities in low-income urban neighborhoods. One of the factors associated with this rise in urban, low-income neighborhoods is residential segregation. Many of these urban, low-income neighborhoods experience unequal accessibility to services compared to their suburban counterparts, which often results in an unhealthy food environment. One of the main reasons for the increasing presence of unhealthy food environments in these neighborhoods is the emergence of food deserts. Several theories regarding the rise of food deserts in low-income neighborhoods are circulating in the literature. One of the prevailing theories states that food deserts resulted from the development of larger supermarkets in affluent areas and the closure of small, independent groceries stores that could not compete economically. Another theory states that supermarket development shifted spatially with the rise of income segregation. As more the more affluent middle-class moved to the suburbs, many inner city grocery stores closed from lack of business. Another prevailing theory is the idea of supermarket redlining, the unwillingness of supermarkets to open stores in the inner city due to various economic reasons. This overall development of unhealthy food environments in low-income urban neighborhoods affects the development of health in the community members. The lack of healthy food options forces these residents to purchase and consume energy dense food options such as meals from fast-food restaurants. These residents are also forced to purchase highly processed foods because of the lack of fresh food options. In addition, food at independently owned grocery stores are often 10–60% more expensive than food offered at large chain supermarkets.Education
Housing segregation has an effect on the quality of education received by community members. Specifically, the spatial separation of specific populations due to housing segregation leads to geographic concentrations of quality education. For example, public schools in suburban areas are usually more equipped with resources, have a higher percentage quality teachers, and produce a larger amount of successful students. The negative effects of housing segregation on quality of education is demonstrated by the lack of integration and diversity in schools. The Equality of Educational Opportunity study in 1966 found that racial composition of schools impacted student success more than the resources available to schools. This cycle of unequal educational opportunities is perpetuated by the real estate market. Areas with quality school systems usually contain higher housing prices and higher property taxes. In addition, these areas are typically racially and economically homogenous. One of the primary reasons of unequal educational opportunities is the low accessibility to the suburbs by minority groups due to lack of income. The suburban areas, containing higher quality education, are less accessible to low-income minority groups. Another reason of unequal education opportunities is the rise in options of schooling for parents. In addition to public schools, parents with enough purchasing power can opt to send their children to private schools, magnet schools and even home school. Other options include charter schools. These various educational options contribute to the relationship between school quality and school enrollment demographics. Quality of education also affects the outcomes of community members. In other words, the kind of education children receive plays a major role in economic opportunities in their future. Students surrounded by other educated members of the community often experience more success with school. Furthermore, community environment and housing quality affect the drop-out rate of students.Poverty
Housing segregation affects the development of concentrated areas of poverty, especially among racial minorities groups. Housing segregation interacts with existing poverty rates among minority groups, especially African Americans and Latinos, to perpetuate the cycle of poor people moving into concentrated areas of poverty. These concentrated areas of poverty often experience a lack of public services and infrastructure. Studies have shown that these residential areas often have less employment opportunities, unequal schooling environments, and increased health risks. These factors combine to perpetuate poverty and prevent social and spatial mobility. The lack of employment opportunities come in many different forms such as decreased accessibility to jobs because of transportation or unavailability of jobs due to location. The result of unequal economic opportunities is the increase in income segregation. This further perpetuates poverty because low-income residents experience higher rent burden which forces them to accept low quality housing. ThisInitiatives against housing segregation
Community building strategies
The relationship of community members is often affected by their physical surroundings. Diverse neighborhoods containing various racial and ethnic groups experience many barriers to community collectivism, such as culture, economic background, and fundamental values. However, having a strong community building strategy can help break down barriers of segregation. Leaders of community strong pro-diversity organizations stress the need for a sense of community among members. Creating a diverse and stable neighborhood requires focusing on economic development, community safety, and education. Focusing on economic development means creating a market in the existing neighborhood. This not only creates jobs for community members but also inhibits disinvestment, a common cause of housing segregation, in neighborhoods. Community safety strongly influences the perception of the stability of a neighborhood. Active participation of community members in the safety of their neighborhood increases community efficacy because there is a perception of controlled crime which, in turn, gives people a sense of control over their quality of life. Education is also related to the positive, or negative, perception of a neighborhood. Schools not only foster safe environments for cross-cultural cooperation but also influence community attitudes towards race, ethnicity, and diversity.U.S. Department of Housing and Urban Development
Traditionally, public housing programs perpetuate housing segregation by forcing minority populations in low-income neighborhoods containing lower quality housing options. Public housing has also be engineered to keep minorities out to keep the integery of the so called "White suburb" and placed minority groups in other areas. However, the Section 8 housing program combats this problem by providing households with housing certificates/vouchers that can be used to rent units anywhere in the private market at a moderate price. In other words, low-income families have the chance to move into affordable and higher quality housing. This option of choice and mobility offers a solution to the social and economic isolation of minority populations. In addition, families using these housing vouchers are more likely than public housing residents to live in racially and economically integrated neighborhoods. TheSee also
* Housing discrimination in the United States * Racial inequality in the United States#Housing segregation *References
Further reading
* Dianne Harris, ''Little White House: How the Postwar Home Constructed Race in America.'' Minneapolis, MN: University of Minnesota Press, 2013. * Leah Boustan. 2011.External links