Building Justice: How Homeownership Failed NYC’s Black Families

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A cascade of crises is forcing America to confront the racism of its past and present—from overt acts of hate to subtler injustices that shape our society. Over 16 weeks, City Limits and Enterprise Community Partners will feature prominent New Yorkers’ views on how race and housing policy intersect to create a legacy each of us must confront, and the way forward we should take together. These are not necessarily views we endorse. But they are views we fully believe are important to share with each other. Here is the eighth post in our series. Read the rest here.

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For White Americans, purchasing a home typically launches their family on a path of upward mobility, allowing them to build assets and transfer them to the next generation. Unfortunately, racial segregation has and continues to undermine the lifetime efforts of the of majority of hardworking, law-abiding, home-owning, taxpaying, Black Americans who labor to launch their families on a path toward upward mobility, build assets and transfer them to the next generation.

Immigrants from Barbados, my parents arrived in New York in the early 1950s. They settled in the western portion of Bedford Stuyvesant, now known as Clinton Hill, and were among the first Black people to purchase a home on Cambridge Place, a tree-lined street of stately brownstones. My parents “chose” Bedford Stuyvesant because it was becoming a Black neighborhood. Massive White flight—Whites selling their homes and moving from Central Brooklyn to all-White neighborhoods in Flatbush, Queens and Long Island—communicated emphatically to my parents that a Black neighborhood was where they belonged. Cambridge Place quickly transformed into the domain of Black families from Southern states, Caribbean Islands and Central America.

During the 1960s, 70s and most of the 1980s, everyone who lived on our street was Black. Many mothers were stay-at-home moms. Most men held blue collar jobs as carpenters, auto mechanics, truck drivers, bus drivers and police officers, among other occupations. Some worked as professionals such as physicians, nurses, college professors and school teachers. Many, including my parents, worked for the city, state or federal government. They purchased their homes with limited or no bank financing, paid their taxes and did their best to maintain their properties. They worked as hard as, or even harder than, their White counterparts, and were subject to the same real-estate and income tax rates as comparably situated Whites. However, the value of their homes appreciated at a fraction of the rates of homes in White neighborhoods and neighborhood schools were vastly inferior to those in White neighborhoods.

For all of my childhood and young adult life, 1953 through 1980, Cambridge Place was designated as part of “the ghetto.” The schools failed to educate. The crime rate in our neighborhood was high. The poverty rate was at least three times higher than the city average and climbed well beyond 35 percent as the government concentrated poverty by investing in the construction of public and low-income housing nearby. White flight and disinvestment resulted in scores of nearby residential and commercial properties being abandoned or poorly maintained. Local quality retail outlets were limited, but transportation options were strong so we rode the bus and patronized the Downtown Brooklyn shopping district.

When I was in the third grade, my parents enrolled me in a school integration program and a school bus carried me to P.S. 130, an elementary school in Kensington, then an all-White neighborhood. My younger brothers followed the same path, and eventually we all attended integrated schools and graduated from college and pursued post-graduate studies. Most of the children in our neighborhood were confined to the segregated, low-performing neighborhood schools. Some overcame this systemic disadvantage to become doctors, dentists, judges, lawyers, and a variety of other noble professions, while too many others succumbed to the prevalence of illicit drugs and crime.

The value of homes in Bedford Stuyvesant and other Central Brooklyn neighborhoods was ravaged by systemic forces. The neighborhoods from which White home owners fled were subject to “redlining,” a discriminatory practice supported by the Federal Housing Administration that discouraged commercial mortgage lending in predominantly Black and Hispanic neighborhoods. Black homeowners were forced to obtain mortgages from private investors, some of whom exacted high cost terms. Many properties were burdened by second and third mortgages from private investors. Black owned or operated financial institutions such Paragon Progressive Federal Credit Union (1941), Carver Savings and Loan Association (1948) and Freedom National Bank (1964) were formed to provide mortgages and home improvement loans in predominantly Black and Hispanic communities. In 1968, Bedford Stuyvesant Restoration Corporation, the nation’s first community development corporation, established a $65 million mortgage pool that originated thousands of low-cost mortgages in Central Brooklyn neighborhoods.

The equity of Black home owners was compromised by other systemic events. Predatory lending led to the 2008 foreclosure crisis that caused Black, Latino, and Asian households to lose over half their wealth. The Great Recession caused disproportionately higher losses and slower recovery of property values in Black neighborhoods. Real-estate fraud, such as deed theft against minority homeowners, particularly in gentrifying communities, compounded the problem.

In New York City and elsewhere, homes purchased by White Americans have historically appreciated in economic and non-economic value over the long-term. The climbing equity of White home owners generally offers them a sense of well-being and stability. In addition to appreciating home values, predominantly White neighborhoods command a host of advantages compared to predominantly Black communities, including strong high school graduation rates, low levels of poverty, and low crime rates. The equity in their homes is available to improve their lifestyles or the life chances of their children. Home equity is routinely leveraged for a range of objectives such as improving the value and enjoyment of the property, paying private school or college tuition for their children or grandchildren, assisting adult offspring with the down payment for a starter home or transferring equity in their homes to their children or grandchildren in support of estate planning.

Tragically, these benefits historically have not accrued to the vast majority of Black home owners, primarily because most have owned homes in racially segregated communities, like the one where my parents purchased their home. As a result, Black home owners face great challenges in transferring to their children the economic and non-economic benefits that are almost routinely transferred by White homeowners. In fact, unless they were able to hold onto their properties for 40 years or more to participate in the growth driven by mass gentrification, few of the Black families we grew up with gleaned the rates of appreciation that are typically expected by White homeowners.

Home ownership has been a precarious path to upward mobility, frequently fraught with more burdens than benefits, for those who own homes in predominantly Black neighborhoods. This tragic truth may partially illuminate why several studies have found that the children of the Black middle-class fall back into poverty more frequently than children of White families with similar incomes.

Racial discrimination and segregation in housing is very much alive in New York City. However, studies show that many White New Yorkers are not conscious of the fact that they currently live in a racially segregated city. As of 2010, New York City had the second highest level of Black/White segregation and the third highest level of Hispanic/White segregation of all metropolitan areas in the United States. As of 2010, New York City had the most segregated schools in the nation. Twenty of the city’s 32 community school districts had 10 percent or fewer White students. Recent investigations undertaken by the United States Department of Justice and fair housing groups reveal that Black families shopping for homes are not shown as many homes or neighborhoods as White families with comparable qualifications. Across the nation, Black families earning $100,000 annually were more likely to live in poorer neighborhoods than White families earning less than $25,000 annually.

In sum, absent a highly intentional and rigorous citywide commitment to undo racial segregation, Black households will continue to have their earnings diluted and Black children will continue to be deprived of educational resources all children require to compete for first class educational and employment opportunities. Not nearly enough urgency or political will exists to remedy the wrongs of the past and create a more equitable future. Policies and practices that condone, foster or otherwise perpetuate racial segregation, whether intentionally or unintentionally, inflict irreparably harmful intergenerational consequences on Black families and the economic and moral well-being of a nation where the majority of children under five years old are members of racial minority groups.