What can be done about the inequities communities of color face when it comes to homeownership

WAKE COUNTY, N.C. (WTVD) -- When the Reids walked into their newly built home last month, it was the culmination of a decade worth of effort.

"It's just a huge accomplishment that Black families don't get to have and it just means a lot to us to be able to do it," Sheena Reid said.

Sheena Reid and her husband Quentin moved into their newly built Clayton home last month. It's a dream they've shared for years and one they've had to actively work towards daily.

'Set up to fail': Communities of color approved for home loans at lower rate than white residents

"When we stepped into this arena we found out it's very expensive, that you need a lot of money, that you need good paying jobs and you need a nice savings account and that is the reality of homeownership and that your credit needs to be at least good," Reid said.

Together the Wake County couple worked to pay back student loans, build up credit and save; all obstacles most first-time homeowners face but ones that impact individuals of color even more.

Alicia Arnold fights these obstacles every day in her role as Wake County's director of equitable housing and community development.

"Right now in the Triangle it's harder for folks to purchase homes, specifically folks that are of lower incomes or different demographics that do not have the wealth or resources available to other folks," Arnold said. "We have to build more housing to address this issue. We have to work on the escalating cost for homeownership, in order to be able to generate homes for those with lower resources than other folks."

These additional obstacles set communities of color back before they even begin the home buying process. The impacts of this were seen clearly in an analysis by the ABC Data Team that uncovered severe inequities in homeownership in 99 of the top 100 U.S. metro areas

The ABC11 I-Team previously reported these inequities are playing out in the Triangle as only 4 out of every 10 Latino and Black residents own a house compared to 7 out of 10 white residents.

Before ownership, these inequities begin in the home loan approval process. Again, the ABC Data Team found inequities between white and non-white borrowers in the Durham-Chapel Hill and Raleigh-Cary Metro areas in both 2018 and 2019, the data suggesting home ownership inequities won't be fixed overnight.

Solutions to the deep-rooted issue aren't simple or easy but some experts hope small steps begin to pay off.

The Reids said they would still be years away from owning a home if it wasn't for financial assistance they received through DHIC, a Raleigh-based nonprofit that helps Triangle families find affordable housing.

Multiple homebuyers assistance programs throughout the state provide qualifying buyers with money. Programs like this help shorten the time between ownership; time that is often longer for Black and Latino buyers.

The Reids were awarded $8,000 for a down payment on their home.

"We would have had to come out of our pocket with $8,000 and we wouldn't have been able to purchase anything for our home. We would still be trying to come up with a down payment even if our credit was where it needed to be, so credit is a huge part but if you don't have money for a down payment, you still can't purchase your home," Sheena Reid said.

The Reids are not alone in their struggle.

"A lot of families just don't know how to buy a house. Where do I even start? We are meeting with them. We are identifying any hurdles, any obstacles, we are creating an action plan and a strategy to work on," described Sheila Porter, the ownership director for DHIC.

She said homebuyer assistance programs really increase prospective owners' buying power, which can have a big impact in the competitive market.

Arnold, the Wake County director of equitable housing, offered additional solutions, including building more affordable housing and protecting people against predatory acquisition of family homes.

"I think that is important to make sure that wealth is carried on through families and not lost through gentrification or revitalization efforts," Arnold said.

Additionally, she said providing financial assistance resources and housing counseling resources to people looking to buy homes could bring more people into the market.

"I think we need to look at mechanisms to apply additional resources equitably for those who really need it," Arnold said.

She added that the next step for the county is to look at data and make investments in the types of housing residents want to buy--not just single family homes but townhomes, condos and duplexes as well.

"Making sure that we're serving the needs of the community and that we have appropriate housing stock available, and I think that's really the biggest area where we can make investments to get housing on the ground," Arnold said. "Making sure that housing is affordable to all of the folks in our community, not just the top end of those who have higher incomes in our community."

Rochelle Sparko, the director of North Carolina policy at the Center for Responsible Lending, said stamping out another lending crisis would have a positive impact on homeownership inequities.

"Any change that we make to student loan policy will disproportionately impact the folks who are most likely to have student loans, which are people of color," Sparko said.

She argued that, because student loan debt extends for years, it takes longer for those who owe these loans to save up enough income for a down payment or to build good credit. Two solutions she provided included student loan forgiveness and expanding grant money for prospective students.

Meanwhile, the small steps forward through programs like DHIC are already making a difference for families like the Reids.

"I still walk room to room from the house in disbelief looking at my kids sleeping, I can't believe you guys are comfortable in your own beds, in your own rooms, it's just unbelievable," Sheena Reid said.
Copyright © 2021 WTVD-TV. All Rights Reserved.