When President Donald Trump noticed some African-American support at a recent rally in Pensacola, Fla., he said black home ownership has reached its highest level.
He brought up that claim along with boasts about enhanced 401(k) accounts, consumer confidence and job growth since the start of the year. But black home ownership hasn’t hit a new record high. (The White House did not respond to an inquiry.)
According to Census Bureau data, black home ownership peaked in 2004 at 49.1 percent. It has fallen incrementally almost every year since. In fact, the rate is now about one-sixth lower than it was at its peak.
African-Americans are less than two-thirds as likely as non-Hispanic whites to own a home, and the most recent rate for African-Americans, 41.6 percent in 2016, ranks behind each of the other four major groups: non-Hispanic whites, Hispanics, Asian-Americans and Native Americans.
In fact, in 2005 the Hispanic home ownership rate overtook that of African-Americans, with the two groups diverging ever since.
The only positive news is that the quarterly figures for 2017 have been a little higher than they were in 2016. In 2016, the quarterly black home ownership rate fluctuated between 41.3 percent and 41.7 percent. In 2017, the rates in the first three quarters were 42.7 percent, 42.3 percent, and 42 percent, respectively. But that's still below the annual levels from 2004 to 2014.
So why has the African-American home ownership rate fallen for the past dozen years? More than anything, it’s been the Great Recession and its aftermath.
“Blacks were hit disproportionately hard by the foreclosure crisis, in part because they were heavily targeted for subprime and other risky mortgages,” said Alex Schwartz, a professor at the Milano School of International Affairs, Management, and Urban Policy at the New School. Those types of mortgages were at the center of the housing crisis that helped cause the recession.
As for the continued decline, Schwartz said, “banks and other mortgage lenders adopted much stricter underwriting standards after the crisis, making it far more difficult to qualify for mortgage credit. Since black and Hispanic households tend to have lower incomes and much less wealth than other groups, they are even less likely than before the crisis to purchase homes.”
Meanwhile, rising inequality and slow income growth for the bottom 80 percent of the income spectrum have made it more difficult for families to accumulate the savings necessary to make the down payment to purchase a home.
“Our research shows that home ownership was not a conduit to wealth accumulation either in the housing boom or in the Great Recession,” said Sandee Newman, who directs the Center on Housing, Neighborhoods and Communities at Johns Hopkins University.
Our ruling
The black home ownership rate peaked in 2004 and has fallen almost every year since, due in large part to the Great Recession and its aftermath. We rate the statement False.
“Black homeownership just hit the highest level it has ever been in the history of our country.”
— President Donald Trump on Friday, Dec. 8, 2017 in a rally in Pensacola, Fla.
