Creating more options for affordable homeownership can help build wealth in struggling communities.
Key Details
- In a recent op-ed for Next City, National Community Stabilization Trust President Christopher Tyson discusses home ownership’s role in developing intergenerational wealth in the Black community.
- Tyson is an advocate for homeownership and works to ensure families across the U.S. have access to affordable home-buying options.
- While young, lower-class, and African-American groups struggle with access to affordable homes due to rising prices and high mortgage rates, he argues that it is still a cheaper and better option to buy a home than to rent.
- Growing financial resources and policies like the Federal Housing Administration allow low-income individuals and families to seek affordable mortgages and assistance.
Why It’s Important
As Tyson argues, many portions of the population are struggling with access to affordable housing, and this is contributing to the racial wealth gap—with only 42% of Black households owning a home compared to 72% of White households. He argues that creating new avenues for homeownership not only improves intergenerational wealth but creates stability in poorer communities.
There are downsides and concerns to creating easier paths to homeownership. Tyson notes that many critics argue that increased homeownership leads to increased gentrification. Similar efforts in the past also played a contributing role in the subprime mortgage crisis in 2007, with many loans being handed out to buyers who could not afford them and collapsing the real estate market in the process.
Tyson still advocates for the advantages of homeownership and wants to encourage young people who do not want to be burdened by owning a home to aspire to it, especially as rent increases and inflation raises the cost of living for non-homeowners. He argues that it is less expensive to own than to rent in half of the cities in the U.S.
Notable Quote
“Homeownership is one of the primary drivers of wealth in the United States. But there are plenty of reasons beyond investing to own a home. Unlike stocks, mutual funds, or other investment vehicles, a home fulfills the essential need for shelter. Owning a home offers families a sense of privacy, control over their own living space, and the opportunity to become part of a community of long-term homeowners. Additionally, homeownership ensures long-term stability of monthly mortgage payments so homeowners aren’t subject to potentially devastating rent increases or forced to move out of an affordable apartment at a landlord’s whim,” says Tyson.