Minnesota’s Homeownership Gap – The Great Recession’s Lingering Effects
Pocketbook related racial disparities show starkly different rates of recovery.
Earlier this year, Minnesota Compass – a social indicators project led by Wilder Research – released findings from an analysis of how Minnesota has fared since the end of the Great Recession. While the data indicate that income and employment overall have largely bounced back, Minnesota’s overall poverty rate remains stubbornly high (10% in 2017), and overall rates of homeownership are trending slightly downward. Further, when the data is parsed by race, “pocketbook related racial disparities” show starkly different rates of recovery.
Homeownership is inextricably tied to what the study refers to as pocketbook issues. While black Minnesotan’s income has bounced back by definition since 2009, this bounce was from the lowest point for any racial group in the state. Black household income remains 47 percent lower on average than that for white non-Hispanic households. Twenty-eight percent of black residents live below the poverty line – four times the number of white non-Hispanic households. And when looking at the homeownership rate, Minnesota’s black homeownership is three times lower than the rate for the state’s white non-Hispanic households. Finally, two out of every five black households in our state are “cost burdened,” defined as paying more than 30 percent of income for housing. This is twice the rate for our state’s white non-Hispanic households.
Clearly, this is a stubborn issue that will require more than basic market forces to change. As the study concludes, the far worse starting positions for Minnesota’s populations of color lay stark the disparities that persist in our state. Moving the needle on our collective homeownership disparity is at the core of our work at the Minnesota Homeownership Center, and we will continue to partner with government, foundations, local nonprofits and the real estate industry to make a positive impact. For more information on our collaborative efforts, check out the Homeownership Opportunity Alliance.