Homes in Black Neighborhoods Are Undervalued by $46,000 on Average, Says Report

Kelly Corbett
·2-min read

News flash: The Fair Housing Act of 1968 did not entirely end discrimination in the housing industry, nor did it eliminate residential segregation. As MarketWatch reports, Black homeownership has hit its lowest point since the '60s. Plus as Zillow finds, Black Americans are rejected for mortgages at a higher rate than their white counterparts are. Now, a recent report from real estate brokerage Redfin shows how properties in primarily Black neighborhoods rank in value compared to those located in primarily white neighborhoods.

According to the report, the average home in a primarily Black neighborhood is worth $46,000 less than a comparable home in a primarily white neighborhood. This research was conducted using value estimates for more than 7 million homes that were listed and sold from 2013 through February 2021 nationwide. It looked at homes similar in size, condition, neighborhood amenities, proximity to schools., etc. The only variable that was different in these two sets of data was the skin color of the people living in the home and around the area.

Related: How Real Estate Practices Systemically Hurt Black Americans

As Redfin senior economist Reginald Edwards said in the report: "Today's Black homeowners are missing out on $46,000 worth of wealth due to racist housing policies that were outlawed in the 1960s and continuing biases among homebuyers and housing professionals in parts of the home buying process like appraisals and mortgage lending."

Unfortunately, this gap is nothing new—in fact, it has remained stagnant over the last decade. Redfin also took a look at data from Chicago homes that have sold over the last five years. It found that the gap was even bigger in this metro area: Homes in Black neighborhoods were valued at an average of $56,000 less than comparable homes in primarily white neighborhoods.

It goes without saying that this gap—especially lasting, as it has, for decades—continues to contribute to a disparity in generational wealth and subsequent opportunities, just one of the many ways America continues to struggle with racial inequity in home ownership.

Follow House Beautiful on Instagram.

You Might Also Like