Wealth gap impacts D.C.'s Black homebuyers
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D.C.’s Black mortgage applicants are denied at almost three times the rate of white applicants.
By the numbers: New Zillow analysis found that 20.8% of Black mortgage applicants in the District are denied. That’s compared to 7.7% of white residents.
American Indian or Alaska Native and Hispanic D.C. residents also have mortgage denial rates higher than white applicants.
Why it matters: Home ownership is widely seen as a key to financial freedom and generational wealth in the U.S.
- Black home ownership overall has dipped in recent years, Zillow found, and so have Black-owned home values.
Zoom in: The most common reasons for Black applicant denials were poor credit history and lack of credit, Zillow reports.
- Pandemic related setbacks have disproportionately impacted communities of color, and as a result have made gaps in credit access harder to close in recent years, Zillow found.
What they’re saying: “The disproportionate impact of the pandemic on Black households has stalled efforts to close gaps in credit access, homeownership, home values, and mortgage denial rates, making the journey to equity even slower than it already was,” Zillow market analyst Nicole Bachaud wrote in the report.
Between the lines: The rising cost of living and rising home prices are other barriers to entering D.C’s housing market. These issues also fuel gentrification, which continues to be prevalent in the District.
- Black residents who do own real estate in D.C. are faced with tough decisions about whether or not to sell family properties.