Mending the Gap to Generational Wealth
Homeownership is a key that unlocks the doors of stability, security, and financial freedom. For families, it is an opportunity to pass down assets from generation to generation. Generational wealth can be defined as assets such as home/properties, cash, stocks and bonds, investments, etc. that can be passed down to one’s children, grandchildren, or chosen family.
For many, homeownership is the first and only introduction to generational wealth and with the current affordable housing crisis, this introduction moves further and further away. Furthermore, the lack of affordable homeownership is also widening the racial gap between minority and white homeowners. Black families embarking on their journey to homeownership continue to experience housing discrimination from banks, realtors, appraisers, etc.
A previous study conducted in 2021 showed that the homeownership rate for black homeowners was 46.4%
in comparison to 75.8% for white homeowners.
How can this be? Black Americans have less access to quality jobs and have lower wages. Black Americans are less likely to gain approval to capital for businesses, loans for home purchases, and/or home repairs. These barriers directly contribute to lower homeownership in the black community. Although the wage gap is significant across both gender and race factors, the income disparity greatly diminishes the ability of black families to increase their net worth, causing a heavy reliance on their home value.
So how do we intervene in this vicious cycle of housing inequality? Habitat for Humanity International and its affiliates, to include Habitat Lake-Sumter, have taken an intentional approach to strategize and advocate for solutions that address the inequitable access to homeownership. One strategy includes increasing community engagement through educational workshops and supportive services. By utilizing this strategy, we can expand opportunities for financial education and programs that provide tools and knowledge needed to prepare Black Americans for homeownership. This approach not only ensures access and opportunity for Habitat homeownership programs, but for other homeownership opportunities as well, while building community partnerships. Another strategy is increasing awareness and expanding our Preservation & Repair programs. Home maintenance and preservation repairs have a tremendous impact on a family’s ability to maintain their home value, retain their home assets, and transfer generational wealth.
We understand the invaluable opportunities that affordable homeownership brings to families, which includes providing generational wealth.
Having an affordable home provides the foundation for stability and financial freedom for families to set goals that can improve their family’s outlook and their future generations. Everyone deserves access to an affordable, safe, and decent home, and Habitat for Humanity is committed to doing our part to be the change in our communities.
Written by Geria Forrest 2024