New Jersey’s Racial Disparities in Homeownership and Housing Wealth

Recent data reveals a devastating portrait of limited housing wealth for Black New Jerseyans. New Jersey’s staggering racial disparities in homeownership were created by design through discriminatory and exclusive policies. They must, therefore, be eliminated by design though policy and systems change. But first, we must understand the characteristics and sources of racial inequities in homeownership in New Jersey in order to develop effective solutions to combat them. The data uncovers troubling trends.

Ongoing obstacles to buying a home lead to substantial homeownership disparities for Black families in the Garden State. While over three-quarters of white households own their home, less than four in ten Black households do (see Figure 1). In New Jersey, the highest rates of Black homeownership are in communities with few Black residents.15 Even in many communities that are majority Black, white residents are more likely to be homeowners.16 The typical white family in New Jersey has $132,000 in home equity, while the typical Black family rents so they have $0 in housing wealth.17

Newark, our state’s largest city, is about half Black, 36% Latina/o and just 8% non-Hispanic white;18 yet, despite having a significant Black population, white residents’ homeownership rate is higher than that of Black residents in all but one zip code of the city.19 The racial homeownership gap is particularly pronounced in Essex County, where white families are almost 40 percentage points more likely to be homeowners than Black families and homeownership rates are lower overall than the state more broadly (Figure 1).

Nationally, the Black-white homeownership gap has persisted for decades21 and it is greater now than

it was in 1960 when refusing to sell to a buyer based on their race was legal.22 While the national Black- white homeownership gap is troubling at 30 percentage points, with the white rate at 72.1% compared to the Black rate of 42.0%,23 in New Jersey, the gap is even wider at 37.5 percentage points (see Figure 1). In addition, data from the past decade underscores a striking persistence in the statewide Black-white homeownership gap, even as Black and white families faced the impacts of the Great Recession and the bursting of the housing bubble; in fact, as in the rest of the country,24 Black families were more harmed by the after-effects of the Great Recession, seeing greater declines in homeownership compared to white families during the Great Recession (see Figure 2). Specifically, in the first half of the 2010s, Black homeownership in New Jersey fell from 41.5% to a low of 36.8% in 2015, an almost five percentage point decline (4.7), compared to a decline of about two percentage points for white families at the lowest point in 2014.

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