This chart explains more about the key social dynamics of our cities than anything else out that I’ve ever put up here, IMO.
Here it is, from a recent City Observatory article by Joe Cortright:
(Note: the blue line is way higher than the red line.)
Cortright’s Observatory analysis references an earlier New York Times article about the deep degree to which white people underestimate disparities in wealth. Here’s what Cortright says, focusing on how the housing bubble affected people of color:
Black households treaded water during the early years of after 2000, and have clearly lost ground relative to whites in the wake of the Great Recession. Today average black wealth stands at just 8.3 percent that of whites.
The lesson of the last twenty years seems to be that encouraging greater homeownership is not just ineffective in reducing the racial wealth gap, but is actually counterproductive.
And there’s a post-script here: As startling as the wealth gap is between blacks and whites, its even sharper between owners and renters. According to the Census Bureau, the median net worth of a homeowner in the United States was $199,600. The median net worth of renters is $2,200, barely one percent of that amount.
For me, the takeaway is that the seemingly “neutral” real-estate market actually represents a unequal playing field. Access to housing is full of deep inequities, between whites and people of color, and between renters and homeowners. This inequality is central to the politics of our cities, yet we often ignore it.
To my mind, taking this gap seriously means focusing policy attention and public resources on renters and people of color, in particular. Resources or policies that focus on the problems of white homeowners seem to me all-but-guaranteed to exacerbate this fundamental housing inequality. I’m not saying cities and decision-makers should ignore white homeowner issues, because that would likely be political suicide. But policies that focus on the problems of the relatively powerful ought to always recognize the massive economic gulf in the surrounding housing landscape. To my mind, as Badger points out in the Times, ignoring this massive gap is one key reason why so many urban conversations seem disconnected.
such an important point -both a racial inequality and the increasing cost of housing in our cities is primary driver of wealth inequality – if you are renter because you are young, single/single parent, lower income family etc, you have no access to the wealth machine of real estate appreciation.
And even if you do, people of color are often not in the more stable neighborhoods, and might not even be served well by the “wealth machine.” There’s some interesting stuff in that first article I linked there…