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Racial disparities in WA homeownership are greater today than in the 1960s

Washington State work group offers recommendations to address public and private sector policies that serve as barriers

A new Washington state report highlights the stark reality that black and indigenous people, and people of color (BIPOC) would need to buy more than 140,000 houses in the state to achieve parity with white homeownership on a percentage basis. The housing gap is even more significant today than in the 1960s, when housing discrimination and redlining were legal.

“Homeownership is the primary way most households build wealth, and yet access to the opportunity to own has not been evenly distributed. Public and private sector policies have for generations built an interlocking web of barriers preventing many black and indigenous people, and people of color (BIPOC) from achieving homeownership,” said Home Ownership Disparities Work Group member Patience Malaba, Executive Director of the Housing Development Consortium of Seattle-King County.

The Improving Homeownership Rates for Black, Indigenous and People of Color in Washington report  released today is the culmination of nine months of work by the Homeownership Disparities Work Group. The work group developed 27 recommendations, twelve of which are deemed actionable in the next several years to remove housing barriers for BIPOC households in Washington. A total of 32 stakeholders with diverse backgrounds in housing, including work group members with experience buying homes through the Housing Trust Fund low-income homeownership program, participated in the extensive effort detailed in the report. Commerce Director Lisa Brown chaired the work group.

“There is nothing more foundational than a home, and we have to ensure everyone has access to a critical resource we all depend on,” Brown said. “The history of systemic, discriminatory policies and practices in housing has had a devastating impact on our most marginalized communities. The recommendations in this report can be a compass to guide our work to eliminate barriers and increase access to affordable housing for BIPOC communities.”

The work group recommendations include changes to the real estate and lending industries. They also suggested policy revisions and funding priorities across all levels of government to unlock housing supply, direct affordable homeownership units toward BIPOC communities, and increase immediate assistance to prospective and current BIPOC homeowners.

The 12 immediate actionable recommendations are:

• Increase biennial state funding for affordable homeownership programs, including land acquisition and pre-development costs.

• Fund a technical assistance/capacity-building program to build the nonprofit organizational infrastructure to develop, finance, facilitate, build, and steward all types of affordable homeownership projects.

• Provide technical planning assistance and resources to municipal governments to increase affordable homeownership units.

• Revise Housing Trust Fund and Housing Finance Commission programs to reduce the administrative burdens on applicants.

• Increase the amount of funding available for direct assistance to homebuyers and homeowners.

• Make current programs more flexible by increasing the per-household limits on existing assistance awards.

• Target homeownership assistance to the BIPOC community via historical ties to culturally specific areas.

• Provide incentives to home sellers to accept offers from purchasers using down payment assistance programs.

• Expand debt mediation and credit repair programs.

• Ensure that awareness of homeownership programs is part of licensing and education requirements for people in the real estate industry.

• Fund culturally specific organizations for outreach to increase the visibility of and access to homeownership assistance programs for BIPOC communities.

• Explore policies to improve connections with BIPOC communities to ensure that interest in homeownership is understood by funders.

“Serving on the legislative work group to address the gap in BIPOC homeownership rates in Washington was a privilege, and the beginning of making change sustainable,” said work group member Michone Preston, Ed.D, CEO Habitat for Humanity of Washington State. “People from communities that have been systematically and historically excluded from opportunities have been prohibited from prosperity through lack of access to homeownership, one of the primary wealth generators in our nation. The vast representation of professional and lived experience on the work team contributed to the success in identifying solutions on many levels.”

“This report is key to starting the process of removing barriers and improving access to homeownership. And, there is more work to be done. Now is the time for action. Every individual who plays a role in the homeownership process has work to do to achieve equity and justice for all,” said Dr. Karen A. Johnson, Director of the Washington State Office of Equity.

The legislature funded the Homeownership Disparities Work Group in 2021, tasking it with identifying barriers and offering recommendations to reduce the disparity in homeownership for Black, Indigenous, and people of color. Commerce is immediately implementing the recommendations that do not require legislative action. For example, to focus on and simplify administration of funding and increase the per-household investment amounts available, Commerce consolidated management of homeownership capital, foreclosure fairness and manufactured/mobile home relocation assistance programs into a new Homeownership Unit.  Access to $25 million in funding for homeownership opportunities through a new streamlined application will open in mid-October.

Commerce will also seek $60 million through the 2023-2025 state budget to enact more report recommendations, including seeking $50 million for capital homeownership projects, 50% of which is to be awarded to organizations with documented homeownership disparities.

Additionally, the department is working with the Harriet Tubman Foundation for Safe Passage to develop a statewide plan to invest Community Reinvestment Account (CRA) funds to address racial, economic, and social disparities created by the historical design and enforcement of state and federal criminal laws and penalties for drug possession. Homeownership is one of the four areas in which CRA money will be invested to address these historic impacts. Learn more on the Commerce website.

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To the WA state legislature, Governor Inslee, WSDOT, Thurston county…