Embedding Racial Equity in Housing

July 9, 2020

Racial inequities have been embedded in housing long before COVID-19.

Redlining, racialized zoning, segregation, predatory lending, urban renewal and exclusions in the New Deal and the G.I. Bill are examples of public policies that have produced the racial disparities that permeate housing policy today. The result of these discriminatory housing practices among Black people and people of color are a main driver for the country’s housing affordability crisis:

Compounding this stark reality, Black people and Native Americans are disproportionately affected by the novel coronavirus, and Black and Latinx people have been impacted the most by public health measures that slow the spread of COVID-19 such as Stay-at-Home orders.

Due to income loss caused by the pandemic and the expirations of eviction moratoriums, one in five of the 110 million Americans who live in renter households are at risk of eviction by the end of September. To make matters worse, occupational segregation has resulted in Black and Latinx people being overrepresented in low-wage jobs that cannot be transitioned to remote work and due to COVID-19 related layoffs, Black and Latinx people are more likely to experience housing instability. In May, Latinx unemployment reached 17.6 % and black unemployment reached 16.8 % in comparison to white unemployment that reached 12.4%.

Forging a path to equitable housing

As national protests and uprisings continue over the racial injustice in law enforcement that has long plagued our country, there is an opportunity for local leaders to boldly tackle systemic racism in their housing systems and repair the harms that have resulted in racial segregation, displacement, and inequitable communities. Over the past few weeks, local leaders have answered the call for public safety budget cuts or reallocated funds in at least 19 cities, as well as intentionally addressing racist policies. In Chicago, leaders have confronted health disparities laid bare by  COVID-19, there has also been the removal of racist symbols and monuments in Richmond and criminal justice reforms in Detroit.

As the nation looks forward, municipalities of all sizes must ensure Black people and people of color, disproportionately burdened by housing instability, are able to retain or secure housing.

Recommendations for cities include:

Conduct a racial impact study. The study will determine the effects of city housing and land-use policies on communities of color.

Implement race-specific, anti-displacement policies. The implication of these policies will mitigate the effects of gentrification, such as Portland’s Right-to-Return initiative which includes an “ancestral clause” that gives top priority to those whose parent, guardian, or grandparent lived in gentrified neighborhoods.

Embed and institutionalize racial equity into all housing and community development strategies and plans. As cities strive to increase affordable housing production, it is imperative that strategies incorporate equitable development methods with considerations for: transparency, community engagement, and collaborative planning. By doing so, municipalities can work towards providing all residents within their community access to quality, affordable housing, and equitable economic growth.

Fund equitable housing development. Starting with its city budget, cities can begin discussing the levels at which they currently fund housing and community development programs. From this vantage, cities can then determine how much in federal, state, and philanthropic dollars are needed to create long-term equitable housing solutions.

Implement inclusionary housing policies. Inclusionary housing policies, also referred to as inclusionary zoning, continue to serve as a useful tool in the production of affordable housing. For cities experiencing steady or increased rates of new construction, inclusionary housing policies are often used to incorporate affordable units within market-rate developments, or to assess fees on the development of commercial or residential properties. Recently, the City of Chicago elected to use developer’s fees, collected through the city’s Affordable Requirements Ordinance, to provide emergency rental assistance grants to residents.

Develop, support and fund shared equity homeownership. Shared equity homeownership is a self-sustaining model that takes a one-time public investment, such as land, funding, property or a combination of these, to make a home affordable for a lower-income family and then restricts the home’s sale price each time it is sold to keep it affordable for subsequent low-income families who purchase the home. The model balances wealth-building for families who would otherwise be unable to afford owning a home with preserving the community’s investment. Examples of shared equity homeownership includes community land trusts, shared-equity cooperatives and limited-equity resident-owned communities. Shared equity homeownership is found in cities throughout the country including Atlanta, Georgia, Boston, MassachusettsMinneapolis, Minnesota, and Durham, North Carolina.

Develop, support and fund comprehensive eviction diversion programs that can assist both renters and landlords. Before COVID-19, cities had begun to tackle the eviction crisis by developing eviction diversion programs, policies, services and technology to address the eviction crisis, which are now more important than ever. Effective policies, services, and technology used to shape an eviction diversion program range from rental inspection programs to court-based diversions.

Challenges ahead for cities

Despite many of the challenges cities can anticipate navigating over the next decade, municipalities must remain steadfast in their commitment to providing a high-quality of life for all with equity at the center.

Housing Supply

Prior to the onset of COVID-19 emergency orders, projections appeared hopeful for the increase in the supply of new homes to address a nation-wide shortage of 3.3 million homes. In January, the federal government reported a 13-year high in single-family and multi-family permit authorizations. However, new construction tends to serve the luxury market and it will take many years before housing costs at these developments depreciate within reach of those most affected by housing shortages.

A recent report revealed that for every 100 extremely low-income households, only 36 rental units are available; and when compared to white households, Black, Native American, and Latinx households are more likely to be more extreme, low-income renters. Specific care is needed to ensure that the infusion of new housing into local markets is positioned to support populations disproportionately impacted by housing shortages.

Cities can do this by using an equity framework when developing solutions to address local housing shortages, which will help to increase access to quality, affordable housing while concurrently addressing the on-going impacts of exclusionary housing policies and practices.

Revenue

In addition to housing shortages across the country, cities are also forecasting significant decreases in revenue. Between 2020 and 2022, cities anticipate over $360 billion in lost revenue. A recent survey of 1,100 municipalities across the country conducted by National League of Cities indicates that the national economic recovery is at risk of stalling if Congress fails to provide direct federal aid to America’s cities, towns and villages. The survey also indicated that cities are making significant cuts to community and economic development programs, code inspection, planning and permitting services.

On top of cities revenue shortfalls and budget cuts, current levels of state and federal support for cities are also declining. A study by the National League of Cities found that for every $100 that the state and federal government invest per person, cities have $3 in additional housing spending needs per person—this means cities have more than $14 billion in additional housing needs.

Now more than ever, as cities navigate COVID-19 recovery efforts, federal assistance is needed to combat the rapidly expanding housing shortage and affordability crisis.

 

About the Authors

Alexis Butler is Senior Program Specialist, Housing and Community Development.

Katherine Carter is a senior specialist with NLC’s Race, Equity And Leadership department. Katherine oversees REAL’s 2020 Cities Responding to Racial Tension National Technical Assistance Cohort, which aims to strengthen local leaders’ knowledge and capacity to sustain community conversations on race relations, justice, and equity.

Lauren Lowery is the Program Director for Housing & Community Development at the National League of Cities.