West Michigan has the most racially uneven housing market recovery in the nation.
That's the conclusion of a national study by the Urban Institute, which examined 100 million mortgages from 2001 to 2013.
Taz George, a researcher with the Urban Institute’s Housing Finance Policy Center, says there's a distinct trend in the number of loans issued and to whom. George says the study “found a huge racial disparity of when different borrowers entered the mortgage market.”
George says following the recession, African Americans and Hispanics were much less likely to receive a loan. George says an "overcorrection" from the years of the height of the housing boom could spell trouble for the broader economy, as fewer qualified buyers can participate in the housing market. And he says that could have long-term effects on the accrual of wealth and savings, with tens of thousands of qualified borrowers excluded from the housing market.
Michigan has two cities, Detroit and Grand Rapids at 5th and 1st, respectively, for the most racially uneven housing market recovery in the nation. George attributes this to how Michigan was particularly hard hit by the recession. In mapping out the recent history of housing loans in both cities, George says he found that in predominantly African American communities, new mortgages have been practically non-existent following the recession. The challenge, says George, "is figuring out how to open the credit box back up to eligible qualified borrowers in the housing market.”
*Listen to Taz Geroge discuss the housing market recovery above
