How Historic Racial Injustices Still Impact Housing Today

For the majority of Americans, regardless of race or ethnicity, owning a home is a major goal. According to the first Zillow Housing Aspirations Report, 63 percent of whites, 63 percent of blacks and 73 percent of Hispanics believe owning a home is necessary to live the American Dream. But although they share the same dreams as whites, for blacks and Hispanics getting into a home remains as challenging as ever-in part due to financial challenges and decades of discrimination.

Historically Denied

Historically, the homeownership rate among people of color has lagged behind the homeownership rate among white Americans, in part because of institutional barriers to entry. Until the late 1960s, federal government-backed subsidies-many of them funded through the Federal Housing Administration (FHA)-were off limits to people of color. The FHA, which was established to help people remain in their homes during the Great Depression, began to promote homeownership during the years after World War II.

And the lagging homeownership rate wasn’t just the result of one program. There were others created to boost homeownership that resulted in similar outcomes for people of color. Black military veterans, for example, weren’t able to borrow money through the GI Bill to purchase homes.

Middle- and lower-income whites benefited most from federal government programs, including low-cost mortgages and subsidies for home builders to construct affordable homes in racially-segregated communities.

Even today, minorities still face more hurdles, similar to the ones they experienced in the past. When blacks and Hispanics try to secure FHA loans, they’re denied about twice as often than their white peers-denials which can sometimes be linked to injustices endured outside of housing. It shouldn’t come as a surprise, then, that fewer blacks and Hispanics apply for these programs.

But for those who do, “far fewer actually get accepted, and the groups that are highly at a loss are black potential homeowners and Hispanic potential homeowners,” said Zillow Chief Economist Dr. Svenja Gudell.

The Consequences

“Housing segregation has not been something that has been quickly changed due to personal prejudice,” said Dedrick Asante-Muhammad, director of the Racial Wealth Divide Initiative at Prosperity Now.

Yesterday’s outright discriminatory policies helped keep minority homeownership low and largely limited to less-advantaged areas. And today, those disparities persist. The Zillow Group Consumer Housing Trend Report 2017 revealed that although they each account for 13 percent of all U.S. households, blacks and Hispanics only account for 8 percent and 9 percent of U.S. homeowners.

Dedrick Asante-Muhammad, director of the Racial Wealth Divide Initiative at Prosperity Now, said low homeownership rates is connected to other disparities.

“African-Americans, in particular, still faced the income wealth disparity, legal segregation, legal job discrimination,” he said. “That continued on through the creation of the American middle class, which limited African-American participation as it pertains to homeownership.”

“Housing segregation has not been something that has been quickly changed due to personal prejudice,” he said. That’s especially true when it comes to those same FHA loans-it’s not just a problem of the past.

Discrimination Still Exists

While Asante-Muhammad says outright legal discrimination has since been outlawed, we’re still seeing the repercussions of the country’s historic discriminatory practices.

“In the 21st century, I think we’re looking more at the issue of the results of housing discrimination and discrimination as a whole,” he said. That discrimination, he added, leads to strong racial economic inequality, which, in turn, makes it harder for people of color to move into more expensive neighborhoods.

Part of the problem, he said, is there’s still market discrimination against homes in black communities.

“A home in a predominantly black neighborhood and the exact same home in a predominantly white neighborhood will have less value because it has less market appeal because people don’t want to live in neighborhoods with black populations somewhere above 20 percent,” he said.

Asante-Muhammad argues some of the discrepancies can be attributed to racial and personal animosity keeping people of color out of higher-valued neighborhoods. But the gap could also be due in part to high negative equity rates-the share of homeowners who owe more on their home than it’s worth-in largely minority communities. When a homeowner is in negative equity, it can be very difficult, if not impossible, to sell their home at all, let alone for a profit they can then use to help buy a different home in another neighborhood.

In black and Hispanic communities, home values fell farther than in white communities, and haven’t been able to fully bounce back from the recession.

Less Money, More Problems

“In terms of closing the gap of white and black homeownership, we’re not moving,” Zillow Chief Economist Dr. Svenja Gudell said.

While minority buyers are trying to enter the housing market, it’s made increasingly difficult due to their lack of wealth.

Gudell said wealth-building in predominantly black communities is hard because of yesterday’s inequalities. It’s actually impossible to point to one single event that led to gaps in wealth for minorities since there have been decades of inequality. Gudell says it’s a compounding effect and something that we “haven’t been able to figure out how to fix it yet.”

“In terms of closing the gap of white and black homeownership, we’re not moving,” Gudell said. “If you look at white homeownership, it’s increasing, while black homeownership is falling.”

Asante-Muhammad echoed those concerns.

“Wealth inequality … reinforces what had been maintained by law and by personal prejudice in the past,” he said. And that lack of wealth is only exacerbated when it comes to home buying.

“So, let’s say you’re getting a $200,000 house and want to put a 10 percent down payment, that’s $20,000. That’s much higher than the median wealth of blacks and Latinos,” he said. A 10 percent down payment is already outside the traditional norm. Typically, a down payment is 20 percent of the home’s value, so $40,000 for that same $200,000 home.

But even if these would-be buyers took advantage of some of the systems in place to help address some of these issues-including utilizing an FHA-backed loan which allows borrowers to make a down payment as low as 3.5 percent-it’s often still not enough.

Asante-Muhammad said even if these buyers got an FHA loan on a $200,000 home-the median-valued home nationwide-the down payment would still be beyond the wealth of most blacks and Latinos. For that $200,000 home, a 3.5 percent down payment would equate to $7,000-or roughly 68.5 times the wealth of African-Americans and 58.5 times Hispanic wealth.

And their wealth today is much less than it was even 10 years ago, when black and Hispanic wealth was $10,400 and $10,200, respectively.

“If things keep going the way they’ve been going, in 2053, the African-American median wealth will be zero,” Asante-Muhammad said.

And that lack of wealth has big repercussions for the future.

“I hope things will get better, but I don’t think the gap will close anytime soon,” Gudell said. “These are such big problems that you can’t just have a quick fix for them but my hope is that we would have equality and balance in the future.”

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Is Your Bathroom a Total Snooze Fest? (It Doesn’t Have to Be)

The current trend of turning household bathrooms into spa-like retreats isn’t a bad one, per se.

Whether waking up with a hot shower or relaxing before bed in a soothing bath, everyone appreciates a crisp, clean palette and great lighting for getting prepped. And neutrals make sense for installed features like bathtubs and sinks – things that are difficult and expensive to change.

But a bathroom has the potential to be so much more than just a white box. The bathrooms we’ve designed, both for clients and in our own homes, have been spaces for color, personality, and a little bit of that sometimes dirty word: whimsy.

Giving the bathrooms in your home more character makes for a quick, inexpensive, and exciting transformation. Here are a few of our favorite decorating tricks. Perhaps they can work in your home, too.

Paint it black. Or blue. Or how about pink?

While your bathroom’s tile and fixtures may be neutral, there’s no reason the walls should be. In fact, you can get away with bold, high-contrast colors in bathrooms precisely because there’s so much white to balance it out.

Concerned that dark walls will make the room gloomy? Worry not – you’ll be safe thanks to the gleaming white tile and countertop.

You can go particularly bold with color in powder rooms. These small spaces generally have little in the way of architectural details, so high-impact paint will go a long way, making them memorable at minimal expense.

One thing to remember: Exercise caution when selecting hues, as the paint color will bounce around the room and onto your skin.

Acidic green can make you look sickly, orange will give you an artificial tan, and a bright blue will drain color from your face. Besides making that first glance in the mirror a bit jarring, the wrong color can cause makeup application challenges.

Get that paper

What if you’re totally over paint? It’s time to graduate to wallpaper.

The wide range of styles and patterns gives you remarkable freedom to redefine your bathroom. Wallpaper works particularly well in small spaces, where the color palette is tightly controlled, and the walls may be at least partially covered with built-ins, mirrors, or tile.

The right pattern can make the room feel more cohesive and, in some cases, help raise the ceiling height to reduce claustrophobia.

Use linear patterns – stripes, plaids, checks – to establish structure in rooms that lack architecture or have low ceilings. Organic patterns, like overscale florals or abstracts, can soften a room that has a busier floor plan or feels unwelcoming.

 

While you have quite a bit of flexibility in wallpaper composition for powder rooms, bathrooms with showers are a good fit for vinyl papers and their moisture-resistant properties. As always, installation matters, and working with a professional paper hanger will give you the longest-lasting results.

Furniture for function and fun

In larger bathrooms or combined bathroom and dressing rooms, you may have a chance to introduce free-standing furniture.

Built-in vanities and storage pieces can overwhelm a bathroom and make it a bit monotonous. To combat this with a little style, we’ve used  small dressers to add enclosed storage space, and bookshelves or smaller tables create a space for towels and toiletries.

While bathrooms are frequently where we get dressed, many of them lack a place to sit down when doing so. Adding a small chair or stool – even a funky old armchair – improves function and style.

When bringing furniture into the bathroom, keep scale in mind. Even in relatively large rooms, open wall space may be in short supply, and there’s the real risk of creating unnecessary obstacles. For best results, prioritize a tidy footprint.

Make bold statements with artwork

Sticking with neutral colors? Wallpaper not for you? No room for a funky armchair?

OK, last chance: Give your bathroom some punch with great art.

We’ve found that most people play it safe in bathrooms with small, framed prints or skip the art entirely. Nonsense! Go for impact with larger pieces – integrate something sculptural or even cover a wall with paint-by-numbers.

Also, it goes without saying, but yes, your most precious pieces should stay in drier spots.

Get more bathroom design inspiration on Zillow Digs.

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1920s Japanese Tea House Turned Zen Retreat – House of the Week

When Larry Genovesi set out to build a home on Massachusetts’ Little Harbor, he didn’t realize he would end up saving a piece of history in the process.

It started as a typical day in 2000. He was strolling through Cohasset, a small seaside town of about 8,000, when a tiny, 1920s Japanese tea house caught his eye. The view of the harbor – and the Atlantic Ocean in the distance – was a huge selling point; the ability to fish just beyond the doorstep was another.

Photo by Brian Doherty.

Genovesi bought the place on a whim, becoming the third known owner of the property. Next on his list: convincing his wife to live in 550 square feet.

“We ended up living there for eight years. I think it’s a testimony to a great marriage if you can live with your wife in 550 square feet,” Genovesi joked. “But it was interesting and it helped us understand the property – the seasons and all that. I’ve always been a fan of Japanese architecture.”

Photo by Brian Doherty.

The couple used that inspiration when they set out to design a larger, earth-friendly house in the same spot. Genovesi wanted to save as much of the existing structure as possible while immersing something modern in the lush landscape. 

The result is a nearly 4,000-square-foot home, surrounded by the harbor on three sides. Each window in the 3-bedroom, 4-bathroom home offers a view of trees or water.

Photo by Brian Doherty.

Of note, a soaking tub in the master bathroom is positioned to take in views stretching to the Atlantic Ocean.

“It’s a great feature – probably my wife’s favorite,” Genovesi said. “It’s a calm place to soak and meditate.”

Photo by Brian Doherty.

The home has other zen features, too, including a koi pond and waterfall. A rooftop deck allows for unobstructed views of the stars. On cooler nights, the owners will cozy up near a firepit at what they’ve nicknamed “sunset point.”

Photo by Brian Doherty.

Added bonuses: the ability to kayak and canoe from the house, regular visits from deer, and blue herons and fruit trees on your front doorstep.

Glass panels in the floor of the dining room honor the surrounding landscape, too, allowing natural light to flood the lower level. There is a kitchenette, a bathroom and a game room there.

Photo by Brian Doherty.

The details are decidedly modern for a home steeped in history. Builders saved nearly 70 percent of the original house, which served as social gathering spot for a well-known New England family.

Workers salvaged three of the four original stone walls, each about two feet thick. They added a steel structure for support and salvaged some of the old-growth Douglas Fir, which Genovesi transformed into the dining table.

Photo by Brian Doherty.

The family has put the home on the market as they search for another adventure – potentially starting an agricultural school to inspire the next generation of farmers.

“It’s very much a place where if you live there, you live in the land. I think the person who buys this needs to appreciate that fact,” he said. “It isn’t one of those big massive houses that you live inside. You really live outside all year-round.”

The home is listed for $4.995 million by Gail Petersen Bell of Home Center Sotheby’s International.

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20 Best Cities for Trick or Treating in 2017

Pumpkins, haunted houses and costumed kiddos can only mean one thing – it’s time for Halloween!

Every year, Zillow’s team of economists crunches the numbers to find the best cities for little ghosts and ghouls to score the best candy. These cities are based on places where home values are high, there are plenty of kids under 10, and where homes are close together, meaning less walking while you’re going door-to-door. After sliding to third place last year, San Francisco reclaimed its title as the #1 city for trick-or-treating, followed by San Jose and Philadelphia, which was last year’s top city. This year’s newcomers to the list are Long Beach, Calif., El Paso, Texas, and Mesa, Ariz.

Check out the complete Trick-or-Treat Index, and the top neighborhoods in each city, below.

Happy Halloween!

Top Cities

Neighborhood Rankings

Methodology

To calculate the Trick-or-Treat Index, Zillow uses the Zillow Home Value Index, single-family home density, and the share of the population under 10 years old in cities with a population of at least 500,000.  This data is combined to reveal the cities where trick-or-treaters can get the best candy in the least amount of time.

5 Reasons to Buy a Home This Fall

Real estate markets ebb and flow just like the seasons. The spring market starts hopping when the sun comes out, flowers bloom and winter is over. Conversely, fall signals the beginning of a slower market, which could be good for buyers.

If you’re in the market for a home, here are some reasons why fall can be a great time to buy.

Leftover spring inventory may result in deals

Home sellers tend to go on the market for the first time in the spring. They often list their homes too high out of the gate, which could mean that a series of price reductions follow during the spring and the summer months.

These sellers have fewer chances to capture buyers after Labor Day. By October, buyers are likely to find desperate sellers and prices that may, in fact, be below a home’s true market value.

Fewer buyers are competing

Families who want to be in a new home by the beginning of the school season are no longer shopping at this point. These families have exited the market, which means less competition. That translates into more opportunities for buyers.

Taking out an entire segment of the housing market provides millennial, single, and baby boomer buyers some breathing room. You’ll likely notice fewer buyers at open houses, which could signal a great opportunity to make an offer.

Motivated sellers want to close by the end of the year

While a home is where an owner lives and makes memories, it is also an investment – and one with tax consequences. A home seller may want to take advantage of a gain or loss during this tax year.

Buyers might find homeowners looking to make deals so they can close before December 31st and get that tax benefit. Ask why the seller is selling, and look for listings that offer incentives to close before the end of the year.

Homes for sale near the holidays signal a motivated seller

As the holidays approach, the last thing a homeowner wants is for their sale to be dragging on and interrupting their parties and events.

If a home has not sold by November, and it’s still sitting on the market, that homeowner is likely motivated to be done with the disruptions caused by their home being listed for sale.

Many homes don’t show as well once the landscaping fades

The best time to do a property inspection is in the rain and snow, because the home will be truly exposed for buyers. The same holds true for fall, when flowers die, trees start to shed their leaves, and beautiful landscapes are no longer so lovely.

Scratching the surface of the pretty spring home season and fall reveals home flaws, making it a great time to see each home’s true colors. It’s better to see the home’s flaws before making the offer, instead of being surprised months after you close.

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Originally published October 19, 2015.