Feb 16, 2024 - News

Black homeowners in Cleveland still face major obstacles

Illustration of a percent sign with a house and upside-down house within the zeroes, forming upward and downward pointing arrows.

Illustration: Shoshana Gordon/Axios

The gap between Black and white homeowners in Cleveland has decreased slightly over the past decade, but there's much progress still to be made.

Why it matters: Homeownership remains the biggest driver of the wealth gap, per the U.S. Department of Housing and Urban Development, writes Axios' Brianna Crane.

Driving the news: Nearly 40% of Black people in Cleveland own homes — an increase of 2.3% since 2012 — compared with the nearly 76% of white people who own homes, per data that Zillow shared with Axios.

Zoom in: Black residents make up 47% of Cleveland's population, according to 2022 census numbers, the most of any race or ethnicity in the city.

Between the lines: In 2021, HUD Secretary Marcia Fudge visited her native Cleveland to introduce the 3by30 initiative.

  • The program is aimed at helping Black homeowners and provides down payment assistance, incentives for affordable housing production and more.

Yes, but: Even if Black people can buy a home, appraising the value of that property remains an issue, especially in Cleveland.

Difference in the typical value of homes owned by Black and white people, by metro area
Data: Zillow; Map: Erin Davis/Axios Visuals

What's happening: The typical home value of Cleveland area homes with Black owners is nearly 41% less than homes with white owners, per data Zillow shared with Axios.

The big picture: Nationally, the typical value of homes with Black owners ($291,000) is 18% less than the typical value of homes with white owners ($354,000).

What they're saying: Black owners seeing their homes appraising for less than those of their white counterparts isn't new. "It's no longer a myth or legend that this happens," HUD chief of staff Julienne Joseph tells Axios.

  • The appraiser workforce is majority white, and it's often difficult to report appraisal discrimination, though new policies are aimed at addressing both hurdles.

Meanwhile, in 2022, the Biden administration announced the Action Plan to Advance Property Appraisal and Valuation Equity (PAVE) task force to fight appraisal bias.

  • In June 2023, PAVE announced requirements for financial institutions to adopt non-discrimination quality control standards and ensure appraisal algorithms are not racially biased.

The bottom line: There's still a long way to go in closing the homeownership wealth gap.

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