A first-of-its-kind study on racial inequities in homeownership in Palm Beach County has concluded that discriminatory housing practices still exist and warned the situation could hurt the economic growth of the area as a whole.
Dozens of housing experts and county officials who took part in a panel on the release of the report this week were aligned on the scale of the problem — and the difficulty of finding a solution. It was done by the Florida International University Jorge M. Pérez Metropolitan Center.
Among the report's stark conclusions were that a history of segregation — to this day — harms the ability of people of color to own homes and build generational wealth, with practices such as exclusionary zoning and racially discriminatory mortgage practices still prevalent. That inequity was exacerbated during the COVID-19 pandemic, academics found.
READ MORE: Palm Beach County's $200 million housing bond ballot question - what you need to know
When it comes to homeownership, there are wide disparities rooted in a history of discrimination and segregation, according to the FIU researchers. Only 52% of Black residents in the region own their home, compared to 59% of Hispanics and 77% of whites.
“Housing discrimination and residential segregation have long hindered the ability of Black individuals and families to become homebuyers and build equity,” researchers wrote.
The Palm Beach County Housing Equity Study was conceived on the back of a $200 million bond approved last year to build 20,000 affordable and workforce housing units to address the county's dire housing crisis. It noted, for example, that almost 30% of renters were "severely cost-burdened," meaning they spent more than half their income on housing.
The Housing Leadership Council of Palm Beach County, a nonprofit group brought in to advise officials in the project, asked FIU researchers to help inform their proposals. The group's CEO Suzanne Cabrera said “equity had to be addressed before we got those units built.”
The roots of the problem
Palm Beach County is home to more than 255,000 Black residents, representing nearly 12% of the population, according to the report, which uses the latest U.S. Census Bureau data. The largest Black communities are in West Palm Beach, Boynton Beach and Riviera Beach.
Lead author Ned Murray told WLRN that researchers at the center have done a number of housing studies over the past few years and “to do it correctly, we really need to go back to the roots of the problem,” he said.
“How did we get to this point? Why do we still have segregated communities? Why do we have these inequities in health and housing, education, and criminal justice? So that's really how it's evolved," he said.
The latest study spotlights several historical Black settlements in Palm Beach County, from Pleasant City in West Palm Beach to Pearl City in Boca Raton, as examples of communities who’ve suffered from unfair government policies and discriminatory zoning and lending practices.
Residents there have historically seen reduced economic opportunities which, as a result, led to inequitable outcomes in other areas of life such as health and education.
Researchers found there are significant differences in median household income among Blacks, whites and Hispanics. They found Black income actually dropped $61 between 2010 and 2021 to less than $53,000. Hispanics fared better at more than $61,000, while whites were far higher topping $81,000.
And the data also shows a higher proportion of people in the multi-ethnic Black communities in the county live below the poverty level, have higher unemployment rate, with more workers in lower-income occupations who live in cost-burdened renter households — all exacerbated by the COVID-19 pandemic.
“There's a lot of disparities that still exist today, largely because of those early years of Jim Crow and segregation and other obstacles to the economic opportunities that just weren't there in these communities,” Murray said.
Racial bias and redlining among key issues
The housing equity study, he said, serves as a guiding framework with the goal of eliminating racial disparities through enforcing fair housing policies and implementing racial equity in housing.
Other key takeways from the study:
- Racial bias in the home appraisal process. Real estate appraisers devalue the market value of predominantly Black neighborhoods in the county. “These areas become devalued because they're looked at originally as Black communities separate from white communities in the early years — less investment occurs but also less community economic development,” Murray said. "So you don't see the business development, you don't see the job creation, you don't see the best schools being located in these communities,” he added. The experts suggest young Black residents in the county should consider diversifying the pool of appraisers and officials should raise institutional bias awareness among existing appraisers.
- The legacy of redlining remains. Redlining is the act of producing coded maps, demarcated lines across communities that are determined too risky for the inclusion of private loans and other investment opportunities. The discriminatory practice historically affected Black homeowners, even if they lived in integrated areas. It’s illegal under the federal Fair Housing Act, but local housing experts say it's still in practice. “There are hundreds of vacant lots in distressed neighborhoods,” said Bobby “Tony” Smith, board member and chair with the Housing Finance Authority of Palm Beach County. "Redlining is still alive.”
- Labor force participation rates. Murray says the lack of affordable housing is stunting the growth of the county's working population. The economy in Palm Beach County is dependent on key sectors such as leisure and hospitality, health care, education and retail — where the vast majority of workers are Black and Hispanic. “This is where your employment is coming from," Murray said. "This is where your economic growth is going to come from. So it would be very wise for counties and municipalities to begin thinking in terms of the newer population, which is younger and people of color.”
- Personal income and lack of credit. Black homebuyers are much more likely to be denied loans due to lack of credit. ”You can’t buy a house if you don’t make any money,” said Patrick K Franklin, President and CEO of the Urban League of Palm Beach County. A large demographic of Black-American households are “led by single-parent mothers with children," households that often struggle in wealth development.
Addressing inequity going forward
The study recommends bolstering a proposed new fair housing rule by the U.S. Department of Housing and Urban Development to help Black homeowners and buyers, and address racial disparities in housing in Palm Beach County.
“It would need to have individuals working in local government and other organizations who are actively involved in monitoring fair housing laws and following up on those complaints and other issues which come about," according to the study.
Currently, residents are protected federal and Florida Fair Housing Act from racial discrimination and other housing discrimination complaints — the law is enforced by the Florida Commission on Human Relations (FCHR).
John "Jack" Weir, of the Housing Leadership Council of Palm Beach County, recommended developing a “revolving construction loan fund” aimed at stimulating the supply of workforce housing, getting more non-profit agencies involved in the development process, and making major lenders who've made commitments to affordable housing more accountable.
Researchers also hope policymakers crack down on discriminatory lending practices and develop more programs for lower-income homebuyers and homeowners who need access to housing rehab funds and other upkeep needs.
As far as the $200 million bond, Palm Beach County commissioner Mack Bernard said officials are currently working on a “bond allocation plan” and “creating the RFP [request for proposal] to “let out those dollars as soon as possible.” Officials have not yet pinpointed where to build the housing units.
