Housing has been crucial to building wealth in our society. While many people think of wealth as synonymous with income, home equity is often the largest component of the average American family’s wealth. In 2000, data collected by the U.S. Census Bureau found home equity to account for 75% of the assets held by the median household in the U.S. Historically, home equity has been critical in the growth of the middle class throughout the U.S. following WWII.
While home equity has been a significant resource to improve conditions for White families in the U.S., families of color have not been able to access the wealth potential of home equity. Several factors account for this problem, a legacy of historical discrimination in lending and access to homeownership, the cost of living in segregated communities and continued discrimination in the housing market. Minority communities are often targeted by sub-prime lenders as well. Recent challenges facing the U.S. housing market, such as exorbitant cost and wide spread foreclosures, amplify these existing conditions, threatening to expand existing wealth disparities in the U.S.