
Key Takeaways
Home price and rent increases over the past decade have disproportionately impacted cost-burdened and minority households.
The homeownership gap between White and minority-led households declined modestly during the pandemic years but remains at a 28.5 percentage point gap.
The share of minorities without a bank account has fallen since the Great Financial Crisis but remains measurably above the unbanked rate among White Households.
Several indicators of public health and environmental quality remain worse in historically redlined areas.
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Introduction
The history of racial discrimination in US real estate and housing policy is well documented. Over the past century alone, racial-exclusionary elements of New Deal-era federal housing programs and unsanctioned discrimination by the real estate industry during the post-war suburban expansion have catalyzed a cycle of inequity. Despite the dismantling of de-jure racial segregation in American housing in the 1960s, evidence of its structural legacy remains pervasive in both housing and non-housing contexts.
The Chandan Economics Racial Inequities in US Housing Report is a multi-themed overview of the contrasting housing and wealth outcomes among commonly referenced racial or ethnic groups in the United States. Our analysis explores the housing outcomes of racial groups within four focus areas: Housing Affordability, Household Wealth, Credit Access and Investment, and Housing and Environmental Quality. The annual report provides a snapshot of the historical intersection between racial disparities in housing outcomes and inequities in other socioeconomic dimensions, such as education, wealth and upward mobility, health, and access to financial markets.
Chapter 1: Racial Inequities in Housing Affordability
Housing affordability remains a pertinent economic and policy challenge in 2025. A pandemic-era rally in home purchases increased the share of American households that own their home but worsened the supply of affordable and available rental homes.
With roughly 3-in-10 Americans renting a home[1], the purchasing power deterioration of the recent price rally is significant and has been more pronounced for low-income families. According to the National Low Income Housing Coalition, between 2019 and 2022, the shortage of affordable and available rental units needed for extremely low-income households increased by 500,000—from a massive 6.8-million-unit shortage to a stubborn 7.3-million-unit shortage.
Despite gradual increases in housing inventory during 2024[2], average home prices in the US metros with the most significant population growth sit well above where they were in the previous decade. The nation’s most cost-burdened households remain increasingly constrained by these realities, and compounding this further is the amplified impact historically and persistently experienced by racial minority groups.
Renter Households in Poverty
Utilizing federal poverty guidelines and household data from the 2023 American Community Survey (ACS)[3], we estimate that the national average of renter households at or below the poverty line across households of all racial backgrounds sits at 21.1% Moreover, racial disparities in incomes and homeownership rates have meant that Native American, Black, and Hispanic renter households are more likely to be income-constrained by rental costs.
Our findings indicate that 31.7% of Native American or Alaskan Native and 27.8% of Black renter households fall at or below the poverty line. 23.7% of households that identify with a racial group other than those segmented in the survey are at or below the poverty line, and 22.1% of Hispanic renter households fall within this threshold.
Sitting slightly below the national average are multi-racial households, with 21.0% of households in poverty. The lowest poverty rates by race are among Asian or Pacific Islander and White households, where the share falls to 19.5% and 18.2%, respectively.

Educational Attainment & Upward Mobility
Underlying these demographic data is the outsized impact of higher education rates on affordability outcomes. Poverty rates drop significantly when concentrating our sample to only include heads of renter households with up to a four (4) year college degree. According to Chandan Economics' calculations using 2023 ACS data, 10.8% of all renter households that hold up to a bachelor’s degree fall at or below the poverty line compared to 25.3% of renters with some or no college experience.

Despite the common assumption that higher educational attainment facilitates reductions in both poverty and racial inequities, our analysis shows that racial disparities remain stubbornly persistent, albeit with nuance.
Renter poverty rates fall across all racial groups for college graduates but fall to a lesser extent for Native American and Asian American households. These tepid effects result in higher rates of Native American and Asian American degree holders living in poverty and only slightly narrow the overall racial gap.
For example, before accounting for education rates, the gap between the racial group with the highest poverty rate (Native American/Alaskan Native with 31.7%) and the racial group with the lowest rate of poverty (White with 18.2%) is 13.5 percentage points wide. When narrowing this to observe only bachelor’s degree holders, the gap between the largest share (Native American/Alaskan Native with 22.3%) and the lowest share (Other with 9.0%) remains little changed at 13.3 percentage points.

These data also suggest there are significant structural disadvantages impacting college-educated Native Americans to a greater degree than college-educated Americans of another race or ethnicity. While just 9.9% of Native American renters have up to a bachelor’s degree level of education, a staggering 31.7% of those degree holders are in poverty. Comparatively, the share of Black American renters with up to a bachelor’s degree is also relatively low at 14.4%, but only 12.2% of these degree holders are at or below the poverty line. Similarly, the share of Hispanic American renters with up to a college degree sits below the national average at 15.6%, but just 11.4% of these degree holders are in poverty.
Household Crowding
Our analysis of household poverty rates by race illustrates a key part of the picture — however, it does not consider household sizes, which is an essential weight in the ACS' calculation of poverty rates.
For example, a head of household with an income of $70,000 per year may fall above the poverty threshold if their household only includes two people. In contrast, a head of household with a similar income but four (4) dependents may fall under the poverty threshold.
Further, space availability in a home can be a valuable guide for health and environmental factors. According to research by the US Department of Housing and Urban Development (HUD), there is an association between household overcrowding and adverse consequences for adults and children.
A useful threshold for analyzing household crowding is to observe the share of households with at least one bedroom per person. According to a Chandan Economics analysis of 2023 American Community Survey data, 15.6% of all US households live in units with less than one bedroom per person. Hispanic and Native American/Alaskan Native renters experience the most household crowding, with 30.9% and 24.4% of the respective populations sharing a bedroom with at least one other person, followed by 20.6% of Asian American or Pacific Islander rental households.
Black, Multi-racial, and White renters are significantly less likely to experience household crowding than other races or ethnicities, but a notable gap between the cohorts remains. 12.9% of Black renters live in a unit with less than one bedroom per person, compared to 12.6% of renters of all other racial groups, 11.3% of multi-racial renter households, and 7% of White renter households.

Notably, differences in social and cultural preferences make it difficult to extrapolate significant conclusions from these data. Further, inconsistencies in how demographic information was collected in previous Census studies limit our ability to conclude causality. Still, measuring average space availability— particularly in renter households— provides a practical way of analyzing crowding and its associated risks.
Housing Underproduction
As housing affordability issues took center stage in commercial and policy circles in recent years, many agree that low housing supply is the primary cause of unaffordability. Moreover, housing underproduction has deepened racial wealth disparities, with Hispanic Americans being more disproportionally affected.
According to a 2022 report from Up for Growth, roughly 92% of Latino [4] Households living in a metropolitan statistical Area (MSA)—51 million people— live in a market experiencing housing underproduction. Such underproduction can lead to household crowding, resulting in fewer individuals purchasing homes and taking advantage of the home equity appreciation homeowners typically enjoy.
Moreover, Hispanic households are projected to account for a significant share of US population and labor market growth, which can magnify the trend’s impact on long-term US fundamentals if housing underproduction is left unresolved. Between 2010 and 2020, Latinos accounted for 51% of the nation’s population growth and 88.8% of labor force growth.
Broader Economic Impact
The effects of income constraints stretch beyond simply the stress of paying rent. In a 2019 paper studying housing's impact on upward mobility, researchers at The Urban Institute compiled evidence showing how high shelter costs can limit future economic success. Individuals who spend a higher share of income on housing are more likely to experience slower savings accumulation. Moreover, high-cost burdens can often push people into lower-quality housing over time without much savings upside. The lack of affordable and available housing also drags local economic output, as residents spend less of their income on non-housing needs.
Chapter Two: Racial Inequities in Household Wealth
While comprehensively quantifying the racial wealth gap is challenging, measuring household wealth provides essential clues, given the significant role of income and asset building on upward mobility.
According to a 2019 paper by Opportunity Insights, Black Americans and Native Americans have significantly lower rates of upward mobility than White Americans, contributing to an inter-generational wealth gap. The impact of the persistent racial wealth gap stretches beyond economic outcomes, affecting environmental quality, crime, and health outcomes in minority-majority areas.
The Homeownership Gap
The homeownership gap between White- and minority-led households is an important metric that underscores the multi-generational challenge of reducing racial disparities in wealth.
According to Chandan Economics’ calculations of data from the 2023 American Community Survey (ACS), White American households remain the only group with an average homeownership rate above the national mean of 65.3%. The gap between White, non-Hispanic households and other races is smaller but persists.
62.4% of Asian American or Pacific Islander households are homeowners, while Native American (57.0%) and multi-racial households (56.0%) sit slightly lower. Hispanic households and all other racial groups hold homeownership rates closer to the bottom of the distribution, charting at 51.7% and 48.5%, respectively.

Despite the dismantling of many discriminatory lending and underwriting practices over the last several decades, the gap between White and Black homeownership is wider today than it was before the civil rights era.
In 1960, the White homeownership rate was 65%, and the Black homeownership rate was 38% — a 27-percentage point gap. Homeownership rates broadly declined across all races and ethnicities in the decade following the Great Financial Crisis (GFC). Still, the gap widened as Black and Hispanic households were more than twice as likely than non-Hispanic White households to receive a sub-prime loan during the housing bubble — exacerbating the crisis’s impact in minority-majority communities.

The homeownership gap between White- and minority-led households has declined modestly during the pandemic years, driven partly by the wage increases and location flexibility brought forward by pandemic effects. However, through the third quarter of 2024, a 28.5 percentage point gap remains between the top and bottom of the homeownership distribution.
The persistence of the racial homeownership gap offers sobering evidence of America’s tepid progress on wealth disparities, but it also understates it. A 2023 study by economists at the Chicago Fed found that standard analyses of the White-to-Black lifetime earnings gap observe the changes in cross-sectional earnings over time, but fail to account for mortality risk. This is key since, according to the report’s background research, White and Black mortality rates converged between 1920 and 1970 before stagnating. Consequently, the study finds that the premium of White male lifetime earnings compared to Black male lifetime earnings is twice as large than would be explained by measures that ignore mortality rates.
Chapter 3: Racial Inequities in Credit Access and Investment
Barriers to accessing financial capital are critical to the protracted inequities in housing and wealth creation. "Credit access" generally refers to a person's ability to borrow financial capital and is a crucial driver of growth in a market-based economy.
Examples of these functions include loans to small businesses, leverage in investment deals, and — probably most commonly — mortgages and credit cards. Credit products like these allow individuals and institutions to invest in areas of potential, often boosting productivity and wealth in the process.
Banking Access
Banking sits at the foundation of credit market access. In addition to providing people with a secure place to store cash, banking relationships function as a key economic engine by being the primary channel through which households access financing. Consequently, limited access or use of banking services in a community can severely constrain its economic potential.
Since 2009, the FDIC[5] has monitored US bank account access via its biennial Survey of Unbanked and Underbanked Households, assessing it across several key demographic segments, including race.
Between a post-Great Financial Crisis (GFC) peak in 2011 and 2023, the rate of unbanked[6] US Households has roughly halved, standing at 4.2% as of the latest tally. Despite an accelerated decline in the unbanked rate between 2017 and 2021, it experienced a tepid decrease of 30 basis points (bps) between 2021 and 2023, its smallest two-year decline since tracking began.

Increased bank account ownership among Black and Hispanic households was the primary driver of the decline over the 12 years. The unbanked rate among Black Households fell precipitously from 21.3% in 2011 to 10.6% in 2023. Similarly, the unbanked rate for Hispanic households tumbled from 20.4% in 2011 to 9.5% in 2023.
Unbanked rates among Native American and Alaskan Native households have also decreased substantially across this period but experienced an upswing between 2015 and 2017 and again after 2021. Native American and Alaskan Native households remain the highest unbanked racial cohort at 12.2%.

While the share of US minorities without a bank account has fallen steadily in the years following the Great Financial Crisis, it remains measurably above the unbanked rate among White Households. The share of unbanked White households similarly fell across the post-GFC period, from 4.0% in 2011 to 1.9% in 2023.
Unbanked rates among Asian and multi-racial households lay below the national average, sitting at 2.0% and 2.5%, respectively. Historical FDIC tracking of Asian and multi-racial banking access is sparse. Nonetheless, between 2019 and 2023, the unbanked rate among Asian households rose from 1.7% to 2.0%, while the unbanked rate among multi-racial households fell from 4.9% to 2.5%.

Key while observing the multi-year trend of banking access among US racial groups are shifts in how households may identify from survey to survey or intentional changes in question design. Beginning in 2023, the National Survey of Unbanked and Underbanked Households breaks out Native Hawaiian and other Pacific Islander households into a separate segment, reporting that 4.8% are unbanked. The introduction of the new segment and ebbs in the share of respondents that identify as multi-racial as opposed to another segment may impact year-over-year comparisons.
Credit Access & Invisibility
Having no established credit history is another significant obstacle to accessing financial markets. An analysis by Oliver Wyman and Experian data in 2022 found that 19% of Americans — roughly 49 million people — don’t have a conventional credit score. Within this, 28 million, or 11% of the population, are credit invisible, meaning that they have no accessible credit record available.
Additional research by Credit Sesame found that as of 2021, more than half (54%) of Black Americans reported having poor, fair, or no credit history at all. 41% of Hispanic Americans, 37% of White Americans, and 18% of Asian Americans reported similarly.

Racial disparities in credit visibility are similarly apparent. According to Experian data, 11% of all Americans are credit invisible, while Hispanic Americans have the highest proportion of credit invisibility, with 16% of consumers having no credit record available. Black Americans and people identifying with a race outside the survey's segments are the second highest, at 14%. Asian and White Americans are less likely to have no credit history, with invisibility rates of 10% and 9%, respectively.

The racial gap in credit access is significantly higher when measuring the share of the population that receives prime credit [7] rates. Asian and White Americans have significantly higher proportions of prime borrowers, representing 62% and 51% of their respective populations. The share drops steeply for Hispanic and Black Americans, with 29% and 20% of the population receiving prime rates, respectively. Similarly, just 24% of those identifying as all other racial groups have access to prime rates.
Asset Investment
In addition to banks and home equity, households keep wealth in various assets meant to stabilize and grow its value. Wealthier households are typically associated with holding a larger share of their wealth in income-generating assets such as stocks and real estate. In contrast, less wealthy households generally hold their wealth in more liquid and less risky assets, such as bank accounts.
According to the Census Bureau’s 2022 Survey of Income and Program Participation (SIPP), the rate of asset ownership at financial institutions has the highest prevalence for both White and Black Households and a relatively small racial disparity compared to all other assets. 97.8% of White and 89.0% of Black households own assets at a financial institution, including checking and savings accounts, money market accounts, and certificates of deposit (CDs).
Income-generating assets generally tend to have lower ownership rates but also display wider racial disparities. 70.2% of White households have equity in a primary home, compared to 38.6% of Black households. Further, 65.6% of White households own assets through a retirement account, while Black Americans' rate is 43.9%.
Home Equity Value
Wide gaps between the asset values of White and Black households also persist. According to the 2022 SIPP, the median home equity value of a White, non-Hispanic householder was $180,000, while the median home equity value of a Black householder was $115,000. Analyses of the data by researchers at the Census Bureau indicate that the racial disparity gaps in the median values of home equity, rental property, and other real estate were each statistically significant.

In addition to potential historical and present causes of the home equity value disparities, biases in appraisal services could be exacerbating it. A study by Brookings in 2022 using data from the FHFA found that homes are consistently undervalued in majority-Black neighborhoods, often up to 23% below what their valuations would be in non-Black neighborhoods.
Hispanic-majority, Asian-majority, and White-majority neighborhoods do not exhibit similar devaluations in comparison to each other. Appraisal bias likely reinforces racial segregation, while its wealth impact is difficult to quantify given that homes typically sell above appraised values.
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Chapter Four: Racial Inequities in Housing & Environmental Quality
Housing quality measures offer researchers an alternative lens on household well-being. Some quality metrics deal more directly with the asset, such as the quality of materials in home construction, utility efficiency, or resources that impact safety and security. However, our analysis focuses on “quality of life” indicators outside of the home, such as access to green space, individual health outcomes, and hospital quality, better capturing the environmental landscape of where people live.
Green Space
Previous research has found that public health and environmental quality measures are more negative in historically redlined areas.
The most typical indicator used to measure redlining's effects are scores from the New Deal-era Home Owners Loan Corporation (HOLC). In a study of redlining’s environmental effects in Indianapolis, using a geographic information system, researchers found evidence of more high-intensity development, low green space, and a disproportionate concentration of brownfield [8] sites in formerly redlined areas. Superfund [9] sites, industrial waste sites, and interstate highways were also more prevalent in formerly redlined areas than in other parts of Indianapolis.

Indianapolis' landscape resembles similar patterns observed nationwide. A 2021 study by Columbia University assessed green space trends in 102 US Urban Areas and found a wider trend of less green space in formerly redlined zones. The researchers also find that other state and local policies made alongside redlining exacerbated this effect, influencing neighborhood designs that reinforced racial disparities in environmental impact.
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Health Impact
Redlining's environmental legacy has a tangible impact on health outcomes. According to a 2020 study by researchers at the Huntsman Cancer Institute using Georgia Cancer Registry data, residing in redlined census tracts coincided with a 160% increase in breast cancer mortality. Meanwhile, HOLC score variations correlate with 91% of variations in cancer risk from air pollution

Contextualizing the potential reach of this issue, the Huntsman study utilized Home Mortgage Disclosure Act data to extrapolate population totals and demographic information for the geographies in focus. It found that roughly 80% of non-Hispanic Black women and 20% of non-Hispanic White women reside in areas with significant lending bias, proving that redlining contributed to both a racial and gender health gap.

Hospital Quality
While less green space and a higher prevalence of environmental hazards help explain variations in health outcomes, hospital quality may also play a role.
While US hospitals were formally desegregated in 1965 following the creation of Medicare (equal access was a requirement for new federal funding), remnants of segregation persist in patient demographics and results. A key reason for this is the prevalence of patients with public or no health insurance in minority-majority communities and the downstream effect this has on hospital quality.
Hospitals that serve large portions of uninsured or Medicaid patients are paid significantly less than those that serve higher proportions of privately insured patients. How medical facilities are reimbursed for their costs ultimately impacts staffing, operations, and quality of care.
Evidence of such poorer hospital quality and its impacts surfaced during the COVID-19 pandemic. According to research from the University of Pennsylvania analyzing data from 44,000 patients across 1000 US hospitals, Black patients with COVID-19 had an 11% greater risk of mortality[10] or discharge to hospice compared to White patients.
Furthermore, while the racial disparities held when controlling for sociodemographic characteristics, they dissipated when controlling for differences in hospital quality.
Climate Impact
Natural disasters have increased in occurrence in the United States, and while Mother Nature does not discriminate, climate impact on lower-income communities can be significantly higher due to poor infrastructure or inadequate access to insurance.
A study on the effects of historical redlining policies on resident heat exposure found that in a review of 108 US urban areas, 94% display patterns where land temperatures in formerly redlined neighborhoods are up to 36° Fahrenheit higher relative to non-redlined neighborhoods.
Columbia’s previously mentioned study of green space observed similar results and attributed national highway construction through low-graded communities that used heat-retaining materials as part of the reason for consistent discrepancies in surface temperature exposure.
While poor infrastructure signals a failure of preventative climate protection in some communities, perhaps more strikingly, there are measurable gaps in the efficiency and effectiveness of government aid distribution in white-majority communities compared to minority-majority communities following a disaster. According to a study by Rice University and the University of Pittsburgh, White-majority communities saw an increase in average wealth after natural disasters. In contrast, minority-majority communities, on average, experienced a decrease.
A key factor fueling these inequities is post-disaster reinvestment activity. According to the study, white communities typically see higher levels of reinvestment following a disaster compared to their minority counterparts. Consequently, minority families in communities where damage is comparable to that in White-majority communities, on average, experienced a smaller increase in wealth or, in some cases, a decrease.
Footnotes
[1] Head of Households only.
[2] Utilizing active listings data from realtor.com through November 2024.
[3] Conducted annually by the US Census Bureau.
[4] 'Latino' and 'Hispanic' are used interchangeably throughout this report. Where 'Latino' is used, this indicates that the data referenced also uses the term 'Latino'.
[5] Federal Deposit Insurance Corporation
[6] “Unbanked” indicates that a household has no current access to a traditional checking or savings account.
[7] Prime credit to a score level where a consumer is considered to have excellent credit and poses little risk to lenders and creditors. [8] Defined as property not in use due to the potential presence of contaminants, pollutants, or environmental hazards
[9] Defined as polluted locations requiring a long-term response to clean up hazardous material.
[10] After 30 days of inpatient care.
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