Bernanke: Housing crash erased nearly all minority & low-income homeownership gains
The recent housing crash has wiped out nearly all of the homeownership gains made by minorities and low-income Americans since the mid-1990s, according to Federal Reserve Chairman Ben Bernanke.
Speaking at the Operation HOPE summit in Atlanta, Georgia earlier this month, Bernanke noted that the homeownership rate for African-Americans dropped by 5% between 2004 and 2012 – more than twice the 2% decline reported for all other groups.
“As a result of the crisis, most or all of the hard-won gains in homeownership made by low-income and minority communities in the past 15 years or so have been reversed,” said Bernanke.
Minority homeowners, particularly African-Americans and Hispanics, have been disproportionately affected by foreclosures during the housing crisis. But even now, in the recovery period, people of color are also facing greater barriers (compared to others) when it comes to obtaining new mortgages.
“The contraction in mortgage originations has been particularly severe for minority groups and those with lower incomes: Since the peak in mortgage lending in 2006, the number of home-purchase loans extended to African-Americans and Hispanics has fallen more than 65%, whereas lending to non-Hispanic Whites has fallen less than 50%,” Bernanke said.
- FederalReserve.gov: Challenges in Housing and Mortgage Markets
- OperationHope.org: Federal Reserve Chairman Ben Bernanke
- Bloomberg.com: Video of Bernanke’s address at the Operation HOPE Global Financial Dignity Summit on Nov. 15, 2012
- PewResearch.org: Through Boom and Bust: Minorities, Immigrants and Homeownership
- WhatTheFolly.com: Bank of America will pay $335 million to settle lending discrimination claims against Countrywide
- WhatTheFolly.com: Wells Fargo settles discriminatory lending claims