Caption: African American Photographs Assembled for 1900 Paris Exposition in a public domain photograph via Wikimedia Commons.
Each year, National Fair Housing Month is celebrated in April in honor of the Fair Housing Act which was signed into law by “President Lyndon B. Johnson on April 11, 1968. The act made “discrimination in housing transactions unlawful,” and prohibits housing discrimination on the basis of “race, color, national origin, religion, sex (including gender identity and sexual orientation), disability, and familial status.” However, although 2022 marks the 54th year since housing discrimination was outlawed, disparities in housing opportunities persist in communities of color.
A Brookings Institution study from 2021 found that “homes in Black and Latino or Hispanic neighborhoods are much more likely than homes in white neighborhoods to be valued below what a buyer has offered to pay.” The National Fair Housing Alliance (NFHA) referenced this study in a tweet in April 2022, to bring awareness to how disparities in home appraisals reinforce the racial wealth gap, and appraisal reform could “create a more fair, just, and equitable society,” as well as benefit the national economy.
The U.S. federal government is aware of biases in home valuations and the role it plays in the racial wealth gap. In summer of 2021, the White House announced the development of a new task force called Property Appraisal and Valuation Equity (PAVE). The task force involves more than a “dozen federal agencies to study appraisal bias and develop a plan to reform a system where homes in Black and Hispanic neighborhoods are valued at lower rates than those in similar white neighborhoods.” In March of this year, PAVE released a detailed action plan on how the U.S. can work to close the racial wealth gap by advancing property appraisal and valuation equity for communities of color.
In the Action Plan to Advance Property Appraisal and Valuation Equity, the PAVE task force grouped its commitments into five categories:
- Strengthening guardrails against unlawful discrimination in all stages of residential valuation.
- Enhancing fair housing/fair lending enforcement and driving accountability in the industry.
- Building a well-trained, accessible, and diverse appraiser workforce.
- Empowering consumers to take action.
- Giving researchers and enforcement agencies better data to study and monitor valuation bias.
Investing in Southern Communities Home to Over Half of the U.S. Black Population
In addition to the federal government, corporate and philanthropic organizations are stepping up to offer solutions through a program called the Southern Communities Initiative (SCI) –a “catalytic consortium to accelerate racial equity funding, programming, and outcomes in six southern communities that are home to more than half of African Americans, in ways that are locally-led, measured, and sustained.”
The Initiative was developed by entrepreneur and philanthropist Robert F. Smith with a consortium of companies, including Vista Equity Partners, of which Smith is Founder, Chairman, and CEO, as well as by Paypal and the Boston Consulting Group. According to the website, SCI acts a channel partner for organizations to: “Concentrate and direct investment resources in local initiatives, Amplify high-impact community organizations and initiatives, Coordinate across the racial equity ecosystem to break down silos, and Track, evaluate and sustain impact in 6 US southern communities.”
One of the Southern Communities Initiative’s racial equity pillars is housing, which means that the group directs investments that focus on “providing access to resources that enable home ownership at fair rates and terms.” Additionally, one of the racial equity enablers identified by SCI is physical infrastructure, meaning that “providing access to affordable, reliable real estate and civil infrastructure to support minority families and businesses,” is essential to close the housing and wealth gap.
To date, the SCI has received more than $100 billion in “corporate and philanthropic racial equity commitments,” and brought together more than 90 partner organizations to support approximately 9,000 Black-owned businesses and minority business enterprises across the six communities that SCI serves: Atlanta, GA, Birmingham, AL, Charlotte, NC, Houston, TX, Memphis, TN and New Orleans, LA. The initiative estimates that it still needs about $2.5 billion in investments to support its goals, but that the impact of the initiative is set to increase exponentially.
Learn more about how corporations are giving back to Black communities with the Southern Communities Initiative.