The House-passed version of the Build Back Better Act, an expansive and ambitious piece of legislation aimed at shoring up struggling families, increasing racial equity and having the wealthy pay their fair share, included funding for housing programs such as down payment assistance, the construction and rehabilitation of affordable housing, resources for Community Development Financial Institutions (CDFIs) to finance housing solutions, support for fair housing programs and zoning reform. These programs would help narrow the racial wealth divide and bring homeownership within reach for more Black and Indigenous People of Color (BIPOC) households.        

The bill stalled in Senate late last year, but members of Congress are now developing a pared down version. To meet his commitment to racial justice, President Biden needs to ensure that funding for housing is part of the new legislation. 

Since the 1960s, increases in housing costs have consistently outpaced improvements in wages, and during the pandemic, housing values have skyrocketed. Home prices increased more over the 12-month period from April 2020 through April 2021 than at any other time during the past 30 years.  

While few but the wealthiest households can absorb these mounting costs, communities of color are finding it especially hard to get by. According to the Prosperity Now Scorecard, a significant percentage of BIPOC families are housing cost-burdened, meaning they spend more than 30% of their income on housing costs. More than 54% of renters and approximately 36% of owners are burdened, which is 10 percentage points higher than White renters and owners.  

The lowest-income renters have been the most severely impacted by the pandemic, with 29% of Black renters and 21% of Latinx renters having fallen behind on rent payments, compared to only 11% of White renters.

And the pandemic has only widened racial housing gaps. The lowest-income renters have been the most severely impacted by the pandemic, with 29% of Black renters and 21% of Latinx renters having fallen behind on rent payments, compared to only 11% of White renters. Black homeowners were also at greatest risk of foreclosure, falling behind on their mortgages (17.6%) at higher rates than White homeowners (6.9%) from August 2020 to March 2021. Moreover, according to the National Community Reinvestment Coalition, the national gap between Black and White homeownership rates in 2020 was worse than at any point in the 20th century. The crisis is likely to continue to worsen. The Washington Post recently reported that, in 40 large housing markets, outside investors have purchased 15% of single-family homes in the last 15 months. Not surprisingly, communities with large Black populations are disproportionately impacted by this loss of homeownership opportunities.  

Housing is a necessity, not a luxury, and is the greatest monthly expense for most families. At the same time, a home is often the most valuable asset a family owns. In the case of Black and Latinx homeowners, 50% of their wealth is generated through their homes, compared to 30% for White families. Estimates also suggest that if we achieved parity in ownership rates across race, the racial wealth divide would narrow by 30%, increasing wealth for Black families by $31,000 and Latinx households by $29,000.  

These numbers illustrate the tremendous impact housing has on financial security, wealth-building and racial economic equity. If any social spending package is going through another round of cuts, housing programs should not be excluded. Housing has an outsized impact on BIPOC financial security and wealth-building opportunities and is too fundamental an issue to ignore. Simply put, Build Back Better without housing is not racial justice.  

Along with housing, we are advocating for the inclusion of the Child Tax Credit (CTC) in any new version of the Build Back Better Act. We believe that funding for housing and the CTC can create transformative change, particularly in terms of achieving racial equity. Please send our pre-drafted email to your members of Congress and let them know that any revised legislation should have funding for housing and the CTC.