A new report published by the St. Louis Realtors Association has defined the racial disparities that continue to impact the regional housing market.
The report, titled “Reimagining St. Louis: A Data-Driven Plan for Fair Homeownership,” analyzed 75,000 home purchases in St. Louis City and County between 2017 and 2022. The report noted the median income for Black single homebuyers in this region is $53,525, compared to $88,919 for their non-Black counterparts, which Black couples earn $80,888, significantly less than non-Black couples at $152,424.
The report also observed that Black single homebuyers have a median credit score of 688, while non-Black single buyers average 746. Black couples carry a median credit score of 718 compared to 776 for non-Black couples.
During the five years analyzed by the report, Black homebuyers purchased homes that are 40% to 58% lower in price than those of non-Black buyers. The median home sale price for a Black couple was $195,000, compared to $307,000 for a non-Black couple.
Black homebuyers faced higher mortgage denial rates across all income levels, which was attributed to debt-to-income ratio, credit history, and collateral valuation disparities. Although Black homebuyers have lower total debt levels, the report found they carry more debt outside of mortgage loans, particularly in student loans, auto loans, and unsecured debt, which impacted their mortgage eligibility.
“The ‘Reimagining St. Louis Plan’ is more than a series of initiatives; it represents a transformative effort to increase Black homeownership in the St. Louis region,” said the association in its report. “The plan outlines a multifaceted approach that addresses financial barriers, promotes fair housing practices, and provides the education and resources necessary to enable Black residents to achieve and sustain homeownership. By doing so, the initiative seeks not only to rectify past wrongs but to build a foundation for long-term economic empowerment and generational wealth within the Black community.”
What is the data on Asian and Indian Americans as compared to their white counterparts? That’s a big piece of the whole story as well. The median income for Asian Americans is $112,000 Asian Indian Americans are $151,200. This is compared to whites at $89,000. This is a huge disparity, are whites being discriminated against because of the existence of this disparity? We can overlay this data on to a graph of the prevalence of 2 parent household compared to 1 parent, as we know, the higher the prevalence of 2 parent household, the higher the incomes. Why is there no focus on this? Having a Father in the home is the biggest predictor of being incarcerated in your lifetime as well. Also, the book: Thirty Million Words: Building a Child’s Brain shows us that having 2 parents in the home and having more educated parents allows a child to hear 30 million more words by the age of 4..this is deterministic of IQ, social intelligence, and overall success in life. Why can’t we focus on the roots of any of these problems? This is a similar problem as preventative medicine, let’s not just treat the symptoms and try to force equality of outcome, let’s prevent it from happening in the first place by being proactive and creating equality of opportunity. It starts in the home and personal responsibility.
It’s a start!
Here is an area to address: “they (nonwhites) carry more debt outside of mortgage loans, particularly in student loans, auto loans, and unsecured debt, which impacted their mortgage eligibility.” Doesn’t sound like a fair housing issue. What about a realtor presentation in an entertaining way to high schoolers in their auditorium explaining ways to manage money so these factors do not lower housing opportunity! Explain how to only use a credit card if you can pay it off in a week and show the power of such a credit score. Use happy animated characters looking at the house of their dreams. Emphasize how to escape from the “I’ve got to have that new expensive car or clothing…” Use lines such as you know how proud your grandmother would be if you started saving money even in a part time job cause someday you want a house. I know of a grandmother who gifted the grandson with downpayment money (had closing costs). Educate in a clever way and encourage. Provide a handout. This realtor association should start a credit clinic to offer a free helping hand. This report for me fails to examine the basic need..