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CEDAR RAPIDS — Policymakers need to “invest in people” to solve the national housing devaluation problem in predominantly Black neighborhoods, a national economic development expert said Wednesday in Cedar Rapids.
“The problem is not about the individuals,” Andre Perry said at the Iowa Finance Authority’s 2021 HousingIowa Conference at the DoubleTree by Hilton Hotel Cedar Rapids Convention Complex.
“The problem here is about policy. It’s about a lack of investment,” said Perry, a senior fellow at the Brookings Institute’s Metropolitan Policy Program.
A Brookings Institute report co-authored by Perry in 2018 shows median home values in a neighborhood that is 50 percent or more Black was $149,217 between 2012 and 2016, according to U.S. Census data.
The median home value in a neighborhood between 1 percent and 5 percent Black was $308,441.
The report took into account different attributes or amenities in a neighborhood, including crime rates, nearby restaurants and commute times. Those factors only account for “roughly half” of the devaluation of homes in Black neighborhoods, Perry said.
That devaluation of homes in Black neighborhoods results in a $48,000 loss per home, according to Perry’s report, for a total loss of $156 billion.
A step in solving the issue, Perry said, is direct investments in potential Black, Brown and Asian homeowners and business owners.
“The problem is if you invest in brick and mortar solely, you will essentially raise the property values, and people won’t keep pace, and then they eventually are pushed out,” he said.
Investing in people, he said, includes removing unnecessary barriers to buying a home.
"I’ve been to a lot of states and counties and programs and cities across the country trying to get more homeowners and business owners, and they make them go through all these financial literacy courses,“ he said.
Perry said Black business owners do not have any greater need for financial education than white business owners.
“So why are we making them jump these hoops?” Perry said.
At the same time, Perry said “there’s little accountability” for those who do not follow the laws prohibiting discrimination in housing.
Improving housing devaluation goes beyond just solving a single problem, given than housing, education and business issues for Black people are “so interconnected,” he said.
“I can’t stand it when people say, ‘If only we can fix the schools, everything will be all right,’ knowing that the way schools are financed robbed school districts made up of people of color of roughly $23 billion annually.”
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