Anderson: A sobering report from the Brookings Institution shows that homes in majority-Black neighborhoods are undervalued by billions of dollars, and that has a domino effect. Hello, and welcome to "Comcast Newsmakers." I´m Tetiana Anderson. I´m joined by one of the authors of this report, Andre Perry, from the Metropolitan Policy Program at Brookings. And we´re gonna talk about his findings and how this results in limited opportunities for African-Americans. Andre, welcome to the program.
Perry: Thanks for having me.
Anderson: So, home ownership is, of course, the American dream. It´s something that we all strive for. But your report shows that homes owned by people in majority-Black neighborhoods are worth 23% less than homes owned by those who live in neighborhoods that are not a majority Black. Talk about the impact of this statistic.
Perry: Yeah, we did an apples-to-apples comparison. So, we compared homes of similar condition, similar makeup, in similar-situated neighborhoods. So, we look for equivalent schools, walkability. We look for the number of restaurants in the area. And what we found, as you mentioned, homes in Black neighborhoods are worth 23% less, and that amounts to $48,000 per home, an accumulative number nationally. That´s $156 billion in lost assets just because of the perception that it is in a Black neighborhood. Again, we controlled for all of the variables, so this is an apples-to-apples comparison. So, that money that is lost is generally the money people put into college tuitions, the money used to start a business.
Anderson: And services for that community.
Perry: And services for that community. That money should be going into municipalities, into their tax coffers. It´s used to move into a better neighborhood. So, when we´re talking about $156 billion of lost assets, we´re really talking about robbing opportunities for people in Black neighborhoods of the American dream.
Anderson: And your study looked at I believe it was 113 neighborhoods. What cities are we talking about?
Perry: Yeah, we´re talking neighborhoods in which there are a significant number of majority-Black neighborhoods and a significant number of neighborhoods where the share of the population is less than 1% black. So, we looked at virtually White neighborhoods versus those that have more than 50% Black neighborhoods. So, there are more than 100 metros across the country we looked at. Folks can easily go to an interactive on brookings.edu and look for the devaluation of assets in Black neighborhoods. And they can look for their metro area to see how they fare because different metros have different values, of course.
Anderson: We´re talking about the loss of services, the loss of good schools, and we´re also talking about the future. This actually impacts Black children who live in these neighborhoods in terms of their upward mobility. What can it do?
Perry: Yeah, we also paired this with a lot of the social-mobility data that has come out in recent years, and we found that homes that neighborhoods where homes have been devalued, you also see lower social mobility for youth, and that makes a lot of sense. Fewer resources means that there´s less money in school districts, less money to go to college, less money to start businesses -- all those things that drive social mobility. And so, it was an alarming statistic to see that it also impacts people´s well-being in the future.
Anderson: So, this isn´t a new story. We´ve heard about this for decades and decades. Take a step back for us and tell us how did we even get to this place.
Perry: Yeah. Clearly, segregation, redlining, racial housing covenants that prevented Blacks from moving into quality neighborhoods.
Anderson: Explain redlining.
Perry: Yeah, redlining was a practice -- after World War II, we issued home-ownership loans, and Blacks were not permitted to get access to those loans because they lived in, literally, neighborhoods with red lines drawn around them. And that was a federal and private-sector practice that has implications for years because that money -- that wealth that was gained over that period of time, Blacks couldn´t get access to.
Anderson: Speaking of private sector, which you just mentioned, what is the sort of responsibility of corporations when it comes to ending this sort of disparity in equalizing home ownership and values of homes?
Perry: Yes, there´s been a recent news story where Microsoft is going to inject billions of dollars into the housing crisis on the West Coast in the Bay Area. Why this is important is particularly in the tech sector, the rising salaries have pushed rising housing prices in regions and making it un-affordable for many. And so, the recognition that many of these companies are now seeing, and they´re now going back to say, "Hey, we have something we can do about this. This is important."
Anderson: Very interesting. Andre Perry from the Brookings Institution, thank you for joining us.
Perry: Thank you for having me.
Anderson: And thank you for joining us, as well. For more great conversations with leaders in your own community and across the nation, be sure to visit comcastnewsmakers.com. I´m Tetiana Anderson.