Racial homeownership gap widens as Black buyers struggle to secure loans amid persistent discrimination and redlining, analysis finds

• The rate of Black homeownership in the US has increased by less than one percent over the last , the National Association of Realtors found.
• On Tuesday, an Ohio-based bank paid millions to the Justice Department after being accused of redlining Black buyers.

The rate of homeownership is increasing for all Americans, but the racial gap between Black homeowners and all other races and ethnic groups continues to persist.

While the US homeownership rate has consistently increased over the years, according to an analysis by the National Association of Realtors, the Black homeownership rate has failed to keep up. In 2011, the rate for Black buyers was 43.6%. Ten years later, in 2021, the rate increased by less than 1% to 44%.

For other Americans, the numbers are much more promising: Hispanic and Asian Americans had homeownership rates of 50.6% and 62.8% respectively, and White Americans led the pack with 72.7% at the time of the NAR analysis.

Black Americans face a number of challenges when trying to purchase a home, but one that exemplifies the systemic troubles they face is redlining, an illegal discriminatory practice in which lenders refuse credit and loan services to individuals within specific communities based on race.

On Tuesday, the Justice Department announced it had secured $9 million from Ohio-based Park National Bank to address allegations of lending discrimination against Black families. Park National was accused of redlining against individuals looking to buy a house in the Columbus metropolitan area, and agreed to pay nearly $10 million to resolve the issue, per a news release.

"For far too long the doors to home ownership have been shut for Black families and many other people of color because of unlawful redlining by banks and other financial institutions," Assistant Attorney General Kristen Clarke wrote.

Clarke continued: "When banks fail to provide equal access to lending services in neighborhoods of color, they engage in modern day redlining and exacerbate the racial wealth gap in our country."

Black renters also face additional financial burdens when it comes to housing, according to NAR. Fifty-four percent of Black renter households spend over 30% of their income on rent while 30% of Black homeowners spend the same amount on housing, according to the analysis.

Homeowners of other racial and ethnic groups fall below the 30% mark, with just 21% of White Americans spending 30% of their income on their home.

"Let (Tuesday's) settlement send a very clear message to banks: we will not tolerate discriminatory lending practices and we will hold you accountable," US Attorney Kenneth Parker for the Southern District of Ohio said in a statement.

In October, the Federal Housing Finance Agency announced it would introduce new scoring models that use alternative credit data to make homeownership more accessible for Americans.