Local & State
|Canít afford to live here? Itís a byproduct of Charlotte history|
|Government, corporate policies deny capital|
|Published Wednesday, July 31, 2019 10:36 am|
|PHOTO | TROY HULL|
|For most of the 20th century, banks and governments denied mortgages in mostly-black, lower-income neighborhoods like Cherry. Gentrification, however, allowed affluent borrowers to buy property in those areas.|
Charlotte’s affordable housing crisis is rooted in racist policies of the 20th century.
State- and corporate-sanctioned bias against African Americans are baked into the nation’s housing market: Black soldiers returning from World War II were denied mortgage access through the GI Bill while banks redlined African American neighborhoods for most of the 20th century, denying access to funds that allowed whites to build generational wealth through equity. That practice continues as low-income homeowners lack the finances to upgrade their homes while middle- and upper income newcomers finance the gentrification of mostly-black communities near the urban core.
The median home value in Charlotte is $226,100 – a 6.7% increase over 2018, according to Zillow, a real estate data company.
The Charlotte Post Foundation is sponsoring a community forum, “The American Dream: Who Can Afford It?” Aug. 8 at Nations Ford Community Church, 7410 Nations Ford Road. Panelists for the forum, which starts at 6 p.m., include:
• Pam Wideman, director of the city of Charlotte’s director Housing & Neighborhood Services department;
• Linda Mendez, a Brightwalk resident who overcame limited financial means to move into the mixed-income neighborhood;
• Dionne Nelson, president and CEO at Laurel Street, a mixed-income housing development company; and
• Ken Szymanski, retired executive director of the Greater Charlotte Apartment Association.
In Charlotte, which has the worst prospects of economic mobility among America's 50 largest cities, the affordable housing shortage is especially acute for low-income residents. Analysis by the Center for American Progress found persistent residential segregation among black mortgage borrowers as the Trump administration weakens or rolls back fair housing policies and desegregation initiatives.
“Although the Fair Housing Act has succeeded in eliminating the most blatant forms of discrimination that were common 50 years ago, the U.S. housing market is still highly segmented along racial lines,” said Michela Zonta, senior policy analyst at CAP. “The legacy of federal redlining and discriminatory housing policies and private practices is still visible today, as housing discrimination has taken different forms and African American neighborhoods continue to be devalued compared with white neighborhoods.”
Charlotte’s affordable housing crisis extends to apartments, too. City leaders are trying to cut into a deficit of 30,000 with the help of a $50 million initiative approved by voters last year, but supply still outpaces demand. From 2010-17, nearly 90,000 apartments were added while 300,000 people moved into the area.
Earlier this month, city council approved eight affordable housing projects and spending $12.8 million from the Housing Trust Fund in addition to donating nearly $5 million in city-owned land.
Charlotte's median two-bedroom rent of $1,148 is less than the national average of $1,191, according to Apartment Finder, which tracks rental units nationally.
As for mortgages, CAP’s national research showed that black home mortgage borrowers are still concentrated in segregated neighborhoods where homes on average have failed to appreciate at the same pace compared to where whites buy. On average, neighborhoods where African American borrowers bought homes during the housing boom of 2003-07 depreciated to levels lower than before the Great Recession of 2007-08. In 2017, for instance, home prices in those neighborhoods were 7% lower than in 2006, compared to neighborhoods where whites took out mortgages, which increased by 2%.
In Charlotte’s metro area, African Americans represent 22% of the population, Zonta said. “Yet, the loan origination rate among black borrowers is only 12 percent. In contrast with other metropolitan areas in the study, in Charlotte, median home prices in neighborhoods where black borrowers concentrate are higher now than before the financial crisis, although appreciation in these neighborhoods has been slightly slower than in neighborhoods where white borrowers concentrate.”
The Trump administration is considering changes in the Community Reinvestment Act, a 1977 federal law that mitigates redlining against low- and moderate-income neighborhoods, or LMIs. The law’s impact on rooting out racial bias and encouraging investment in underserved communities has been mixed.
Advocates credit CRA with infusing $2 trillion into poor communities through mortgage and small business lending. Although some critics blamed mortgages to lower-income borrowers for the Great Recession, CRA loans perform as well as prime loans and have a lower delinquency rate than subprime loans that caused the Great Recession. The Federal Reserve reported 6 percent of subprime lending that sparked the financial meltdown was related to CRA.
Nearly 100 percent of banks earn at least a “passing” CRA rating in part because the consequences of failure are severe. Financial institutions that fail to meet the requirements risk bans on mergers and new branch openings, which has been a source of irritation for banking leaders who consider the regulation antiquated. For instance, online banks don’t rely on brick-and-mortar branches – a key element of CRA’s grading matrix.
CAP’s analysis found that while lending to black borrowers continues to increase after the housing crash of 2007, segregation patterns persist.
In the years after the Great Recession, blacks still buy homes in neighborhoods with large populations of people of color. On average, 51% of the population in the neighborhoods where blacks bought their homes are of people of color, compared with 22% of the population in communities where whites took out mortgages.
In Charlotte, “high-income black borrowers tend to move to neighborhoods with higher percentages of black residents, regardless of the income level of the neighborhood,” Zonta said.
|Howie Acres Community is near the light rail and this Neighborhood is predominantly AA . Established in 1946 the only two streets that AA could live on for many years. Now we are being invaded by investors who continually harrass residents about selling their houses.|
|Posted on July 31, 2019|
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