A Long Road Home: A Racial Equity Analysis of Homeownership Support Programs in Massachusetts

Blog post by Anne Calef, Kelly Harrington, Aja Kennedy, Luc Schuster
September 2023

Boston Indicators   (Boston)

The Boston Foundation’s strategic focus includes efforts to redress racial inequities and disparities. In working to advance equity, we have identified the core areas where our resources are most likely to have a meaningful and lasting impact. Prominent among our efforts are those that seek to close racial wealth gaps by boosting homeownership. We focus on homeownership and the scaffolding that supports purchasing and owning a home—such as access to capital, home appraisals, credit scoring, and loan approvals—because homeownership remains the largest source of family and individual wealth in America.

Throughout our country’s history, discriminatory policies have denied homeownership opportunities for households of color and those living in under-served communities. Covenants barred prospective homeowners of color from owning or occupying a home, redlining graded neighborhoods based on presumed lending risks, and predatory lending practices targeted the financially vulnerable, making it nearly impossible for many to own a home and accrue wealth with it. Massachusetts was not exempt from that history but has been a national leader in helping people historically shut out of homeownership to purchase a home, through a number of state programs and policies.

This latest special report from Boston Indicators examines these efforts by the Commonwealth to increase homeownership: What is the current situation? What solutions have been tried? Who is at the table? What ideas deserve more attention?

A Long Road Home draws on qualitative and quantitative research to illustrate and assess good faith efforts to counter racial discrimination in homeownership. Significantly, it shows that the array of programs and policies that exists is often confusing to those seeking to buy a home. The report recommends ways to improve or expand on existing practices.

Increasing the scope and effectiveness of such efforts is of utmost importance, as erasing the racial wealth gap will benefit all of us. By one estimate, not eliminating the racial wealth gap has cost the American economy $16 trillion over the last 20 years. Closer to home, the Massachusetts Taxpayers Foundation estimated that closing the racial wealth gap in Massachusetts could raise the state GDP by $25 billion over the next five years. Closing the racial wealth gap means more money in the system for everyone—regardless of race or ethnicity. Expanding homeownership among people of color is a key catalyst for shrinking that gap, and the resulting increased community health and vibrancy in stabilized and flourishing neighborhoods enhances the region for all.