The “Segregation Tax”: The Cost of Racial Segregation to Black Homeowners

In recent years, federal policies have focused on increasing the percentage of Americans who own homes – particularly minorities, since their homeownership rates have lagged behind those of whites. While homeownership has increased for all racial groups, what is not clear is how well this has worked for wealth-creation. This paper finds that in the 100 largest metropolitan areas, black homeowners receive 18 percent less value for their homes than white homeowners. The author discusses the implications for public policy and offers a series of recommendations for achieving racially balanced and economically diverse neighborhoods.