By Wayne Dawkins
Special to the AFRO
In American former ghettos, housing is hot because of gentrification.
A few weeks ago, my mind was blown. While in New York, some friends asked me to roll by a block party inside our old elementary school playground in Bedford-Stuyvesant.
When I exited the Bedford-Nostrand avenues “G” subway station, an equal number of Blacks and Whites were coming and going. The last time I saw any Whites using that station was during the late 1960s, when a pharmacy college was functioning near the corner of the subway stop. That building is now a converted Masonic temple.
What has changed is the heart of Bedford-Stuyvesant, once 80% Black and Latinx in the 1960s, is gentrified. Inside Benjamin Banneker P.S. 256 playground, Ernie L. DJ’ed and blasted hip hop music. Nearby, White and Black moms pushed swings for their pre-school age children. Across the street on the block where I grew up, the housing was a mix of newly converted single-family fortresses, and shabby three-story apartment houses. For those who can hold on and not get priced and pushed out whether they own or rent, good luck.
Miami’s Little Haiti, another ghetto, is now eyeballed as a hot, desirable real estate location, according to the Washington Post and CBS News. Remember the luxury Miami-area condo tower collapse that killed 100-plus residents? Beach erosion likely contributed to the disaster. Sea level rise from climate change was another culprit. Affluent waterfront property is threatened. Little Haiti is on higher ground, about 9-feet above sea level, reported the Post. Residents could be involuntarily pushed off their land because it has become too expensive.
For many, now is a great time to be a homeowner. The average value of a house is up 23% compared to what it was worth a year ago, reported the Wall Street Journal this week. Meanwhile, new construction is scarce, slowed because of the 18-month coronavirus pandemic. Yet, interest rates are still low, and people with the money to buy are willing to purchase seller’s houses for much more than the assessed or appraised values.
Blacks and Browns often do not have enough down payment money, 20%, to compete. The well off with cash have been outbidding other home buyers. Anecdotally, I know of a colleague and homeowner who was having a new house built, then the value of the new construction leaped $10,000 because of a lumber shortage. That price spike just cooled, but the damage may have been done and priced the couple out of their dream.
Housing help appears to be on the way: Marcia Fudge, longtime congresswoman from Ohio, joined the Biden administration as Cabinet secretary of HUD, Housing and Urban Development.
Fudge’s reputation is that of an energetic advocate. Her daunting reality is that the Black-White homeowner gap has widened to the level that existed in 1968. That moment 53 years ago was when the Fair Housing Act became law, only days after Martin Luther King Jr. was assassinated. Restrictive covenants and other tactics to stymie Black home ownership were lifted.
Yet, a dozen years ago, many families were crippled by the subprime mortgage scam run by big banks and mortgage lenders during the 2007-2009 Great Recession. Black America in the main has not recovered from that theft of generational wealth. Many families are understandably wary of re-entering the home ownership class, but they should try. Just apply savvy when entering.
For existing homeowners, refinancing is an option. Just be careful.
Read the paperwork, for errors and statements that are murky. An application could be 60 pages long. Once signed at least a dozen times, the application goes to underwriters, who may ask a handful of new questions.
Or, underwriters can throw customers off by claiming, inaccurately, that basic information, Social Security Numbers, utility bills, or other proof of primary residence, is missing from folders.
Does this happen often? An experienced real estate executive was asked.
“All the time,” he answered. Many hands don’t know what the others are doing.
Remain calm and show the lender where to find the proof, then close the deal.
A homeowner who stayed the course successfully refinanced at a lower interest rate and saved $120 a month compared to the cost of the previous mortgage; $1,509 dropped down to $1,392.
The writer is a professor of professional practice at Morgan State University School of Global Journalism and Communication.
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