2 tokens, one white and 1 black, sitting atop 2 separate piles of blocks


Black History Month 2024: Generational Wealth Gap and Home Ownership

02/8/24  |  Liz and Ellie Local

Owning a home is a much touted part of the American Dream. You know the one: white picket fence, big yard, friendly neighbors. And whether it boasts a decorative fence or not, houses are one of the few commodities that increase in value over time. In fact, home ownership is one of the major factors in building generational wealth–assets that can be passed from one generation to the next, providing stability and financial safety for one’s descendants. Unfortunately...

The American Dream…or the American Nightmare?
Unfortunately, due to racist policies and banking practices, which you can read about here, home ownership was (and still is) unattainable for many Americans—most egregiously, Black Americans. This lack of equity and stability in home ownership has contributed to the gap in generational wealth between Black and White Americans. For Black History Month, we are exploring the truth about real estate’s role in the generational wealth gap in America, along with resources to learn more, make changes, and gain access to home ownership yourself.


The gap is real. And really big.
The numbers tell a stark story. A 2023 study by the Pew Research Center revealed that the median net worth of Black households in 2021 was only $27,100, nearly ten times lower than the $250,400 for White households. With homeownership being a primary source of wealth for many, the disparity in homeownership rates has perpetuated the wealth gap between Black and White Americans.


Let’s go back to (nearly) the beginning
If a person’s ancestors were free landowners in 1800, they had the opportunity to pass along their savings and assets to their children. Their children could benefit from their inheritance, build upon it, and pass their home (or the money gained by selling it) to their children, and so on, for more than twenty generations. Today, 46% of young White households—those with members under 35 years old—own a home; and about 40% of these households received money from parents for their down payment. This is the result of a positive feedback loop that began in 1800 and allowed the descendants of that family to amass significant wealth. 


Now, think about ancestors who were enslaved in 1800, and as such, earned no money and possessed no assets. They were barred from owning anything; thus, there was nothing to give to their children. Even after slavery was officially abolished in 1865, White lawmakers passed the Jim Crow laws, which effectively barred Black Americans from home ownership for another hundred years. The Civil Rights Act of 1964 sought to dismantle some of those policies, and certainly did; in fact, the wealth gap did close a bit right afterwards. However, racist attitudes and policies have remained in place for decades, and some are still in place today, usually through “exclusionary zoning laws” (Read more about the practice in this blog from the White House’s website). If home ownership is the key to generational wealth, then these ancestors’ descendents have been excluded from it completely for hundreds of years, and only now are beginning to have some access to its benefits. Only 17% of young Black households own their own homes today; their families have not had time to build up generational wealth. In short, White Americans have had a 220-year head start to build up their wealth through their homes. 


This situation can feel insurmountable
However, there are specific steps one can take to expand access to home ownership. If you’re a first-time homebuyer, there are additional resources to help you get that first home and start building your own wealth. Start exploring below, and reach out if we can help! We love providing access to information and empowering people within our role as real estate agents.


Get help buying a home
Use these programs to gain access to support and resources, including financing: The Boston Foundation is a group of over 40 businesses and organizations who are dedicated to closing the racial wealth gap. MassDREAMS and My Mass Home offer grants for first-time homeowners with a focus on equity. In fact, one of our recent clients bought her first home with a MassDREAMS grant. MA Housing offers help with down payments. HUD (US Department of Housing and Urban Development) has an easy-to-browse collection of programs available in your specific city or town.


If you’re a reader, try any or all of these works (consult your local bookshop. We love Porter Square Books in Cambridge and Molly’s Bookstore in Melrose):

The Disillusioned by Benjamin Herold
Family Properties by Beryl Satter
The Color of Law by Richard Rothstein


Call your representatives
Habitat for Humanity has published five ideas for policy changes that can increase access to stable housing. Read through them, find your representatives, and advocate for these changes.


Share what you’ve learned
This article by the MIT Sloan School of Management goes deeper into the causes of, and possible solutions for, the home ownership gap. Share what you have learned with friends, family, and colleagues to elevate the conversation.



The generational wealth gap took root hundreds of years ago, and will require time, hard work, and cooperation to close. We at Liz & Ellie Local pledge to do our part to help. We also urge everyone to consider what actions they can take to contribute to closing the gap. Whether you're a first-time homebuyer or an advocate for equitable housing, there are opportunities to make a difference and pave the way for a more inclusive and equitable real estate landscape.

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With their complementary communication styles, responsiveness, competence, and ability to truly listen, Ellie and Liz enable their clients to feel at ease throughout any real estate transaction. They would welcome the opportunity to be your next real estate advisors.

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