*According to reports by the Economic Policy Institute, Black Americans today earn even less compared to their white counterparts than they ever did–and at this point in time, the disparity between blacks and whites in the US is at its peak.
Back in 1979, the wage gap between blacks and whites was 18.1%. However, with time it expanded reaching to 26.7% by 2015. This is why the rate of African-Americans who do not own a home is increasing rapidly.
As people look to recover from the 2007 global financial crisis that left a number of them unemployed and homeless, blacks are not sharing in the recovery. The average hourly wages of black men have been on a decline falling to 31%, their lowest ever, in 2015.
It all started when in 2007, a severe financial crisis hit the world. What began as a crisis in the subprime mortgage market in the US soon turned into a global recession that took years for people to recover from. It was during the time when the housing bubble was at its peak that most African-Americans were tempted by generous lending from the banks, in the form of loans, and purchased properties. Lenders at that time targeted minorities and gave them subprime loans, although they knew that the applicants did not even qualify for lower-interest loans. Thus, many blacks are yet to pay back their loans.
In 2016, the homeowner rate of blacks fell to 42.2 percent. Experts explain the reasons for the lower ownership rate of the blacks saying that this is because of their underemployment and significantly low wages in the past.
Even African Americans who inherited properties from their ancestors could not retain them. Now, what is making it all the more difficult for them to keep hold of their own the houses again is the lack of affordable housing and stricter lending, plus lower income levels.
According to a study, black households have only 6% of the wealth of white households.
Owning a house is an important part of the American dream. It is a great way of building wealth. The lower inventory of houses in recent times, however, is unfortunately adding to problems of the Americans. According to reports, there are only about 30,000 properties available for sale in the Atlanta area compared to 100,000 properties that were available for sale in 2004, which marked the pinnacle of US home ownership. At that time, nearly 50 percent of African-Americans owned homes.
Even though the overall rate of blacks owning homes has fallen, a few areas are dominated by a higher percentage of African-Americans. Areas such as the New Haven metro area in Connecticut have reported a small increase in their home ownership. Even though this is a plus for black homeowners, it remains a fact that as the housing market recovers in the US, the struggle for black homeowners continues.