Homeowners Now Whiter and Richer as Black Poor Shoved Out
By Simon Templar
Gentrification is a fact of life to day in New York City’s most populous borough. Today, if you are both Black and poor your chances of owning the so-called American Dream of a home (not an apartment) is nil to nothing. The fact is that an incestuous collusion between the New York City Administration and real estate speculators and developers has conspired to shove out the borough’s poor. The upshot is that Brooklyn’s homeowners are now richer and whiter in the decade following the housing crisis
This is the conclusion of a study by the Center for NYC Neighborhoods report, “Affordable Homeownership 10 Years After The Crisis,” which shows troubling findings for working-class and non-white New Yorkers after the 2008 subprime mortgage housing meltdown crisis.
“As of 2017, New York homeowners tend to be wealthier, older, and whiter than most New Yorkers,” the report said. “Most New Yorkers are shut out of home ownership due to rising prices, while many existing homeowners struggle to keep up with housing costs, taxes, and needed repairs.”
This has aggravated the housing across New York City and has been more pronounced in the Black community, especially in Brooklyn where gentrification – a new white population that is pushing out a poor Black population (Caribbean and African Americans) – is taking root at an alarming rate. At least seven zip codes in Brooklyn rank as the highest in terms of gentrification.
This is the unintended consequences spawned by wrong-headed policies. Brooklyn is now in a scramble for real estate by speculators and investors in a kind of gangster more as the city’s administration turns a blind eye and looks the other way. Just look at what’s happening in NYCHA and the unbelievable building boom that has taken over the borough,” said Haitian community leader Mercedes Narcisse.
She’s right on the money. But the grim situation does not end there. Most – the vast majority – of the new housing stock in Brooklyn and labeled “affordable” is anything but for the majority of Black and Brown residents. When nearly 90 percent of Black Brooklyn families pay nearly 50% of their annual income in rents the prospect of homeownership is very distant and unattainable. Add that to the ever-rising costs of rents that the picture becomes even bleaker – these “affordable apartments” go for an average of $2,100 a month – way out of the budget of most Black Brooklynites.
“These affordable housing apartments are not built with Black and Brown Brooklyn in mind. For one thing they are way out of the financial reach of poor Brooklynites. They are built for a new group that coming in and displacing the poor. Its not affordable for Black Brooklynites when you need to be making over $75,000 a year in income to quality,” Ms. Narcisse told CARIBBEAN TIMES NEWS.
Analysts linked the rising wealth of New York City homeowner to a “substantial shift” in the racial composition in ownership, and pointed to Brooklyn where white homeownership has spiked. For example, in 2017, more than half of Brooklyn’s homeowners were white (approximately 149,000) while the number of Black homeowners dropped by 5,000 between 2005 and 2017, the number of Hispanic homeowners dropped 18 percent between 2008 and 2017, and the number of white homeowners grew by 17,000.
Today, while white and Asian households are far more likely to own homes in 2017, Black and Hispanic households were more likely to go into foreclosure and ultimately lose their home that are gobbled up by white buyers at pepper pot prices. The report quoted above also argues that the shift is the result of Black and Hispanic homeowners having been targeted for “shady loans” during the housing crisis, and the “soaring prices and a tight lending environment” of today’s New York real estate market that both redlines and discriminate against Black and Hispanic potential buyers thus enabling gentrification in places like Brooklyn.
Here are the blunt statistics: The number of Black Brooklyn homeowners granted home purchase loans plummeted from 2,023 in 2007 to just 720 in 2017 – 2 years ago – the study found. And just 40 percent of Black applicants were approved for refinancing loans in 2017, as compared to 52 percent of white applicants. This deliberate real estate, city and finance redlining and discrimination has devastated the housing stock in Brooklyn where exorbitant rents, racial remaking of historically Black communities and usurious practices that is forcing Blacks out of the borough.
The report states bluntly that the end result is that in 2019 homeownership has become less attainable in Brooklyn. And if you need more confirmation of the deliberate and crippling effects of white gentrification in Brooklyn then look no further than 2017: the median income for mortgage borrowers in Brooklyn was a staggering $144,000. That’s more than twice the New York City median income.
Moreover, unlike many parts of the country, home prices in New York City have not only recovered, but have surpassed pre-crisis levels. As a consequence, homes are currently priced at levels inaccessible and unattainable to most New Yorkers who have seen only modest wage increases, if any, over the past 10 years. Combined with a rise in investor purchases, speculation and tight lending conditions, these trends are preventing many would-be homeowners from entering the market.
For younger New Yorkers the home ownership conundrum is real and stark: In 2017, there were 39,000 fewer homeowners under the age of 35 than there were in 2008, a 34 percent decrease. Today, millennials (born in 1983 and later) in New York City comprise only 7.5 percent of homeowners.