Seattle-area residents misplaced tens of billions in wealth on account of racist housing insurance policies: report

Households led by folks of coloration residing in King County, Washington — the world that Seattle sits in — misplaced an estimated $12 billion to $34 billion in wealth since 1950 on account of racist housing insurance policies. That is in accordance with a report commissioned by King County, which was first reported on this week within the Seattle Times.

The report, carried out by consulting agency ECONorthwest, discovered that the sizable totals of misplaced wealth weren’t solely attributable to racially discriminatory insurance policies and practices together with redlining, but additionally to cash that went to lease funds that didn’t assist to ascertain the expansion of a family’s wealth.

The report additionally accounts for “wealth misplaced due to decrease dwelling worth appreciations for properties owned by folks of coloration in contrast with white folks,” in accordance with the reporting.

When particularly King County’s Black households, the estimated intergenerational wealth loss since 1950 is estimated to be between $5.4 billion and $15.8 billion, and in addition included a rundown of a number of the insurance policies the report recognized as racist.

“The decrease estimate relies on inflationary changes and the upper estimate relies on the expansion of the S&P 500,” a abstract of the report issued to county leaders mentioned.

This features a coverage going again so far as 1855, 34 years previous to the admission of the territory to the Union as a state, when “Washington’s first territorial governor compelled Indigenous Tribes within the space to cede their lands and transfer to reservations,” in accordance with the abstract.

The report additionally recognized federal insurance policies tolerated by state and federal governments that contributed to the melancholy of wealth for folks of coloration, together with the 1934 institution of the Federal Housing Administration (FHA) which “incentivized communities to embrace single-family zoning and racial deed restrictions to be thought-about for mortgage insurance coverage, feeding into the observe of redlining,” the abstract mentioned.

“Discriminatory practices and insurance policies in authorities, the banking, and actual property industries proceed to impede entry to homeownership for [Black, Indigenous, People of Color (BIPOC)] households immediately,” the abstract defined. “These discriminatory practices negatively have an effect on credit score scores, mortgage entry, and the overall monetary safety of BIPOC households, such that getting homeownership has been, and continues to be, a big and unacceptable hurdle.”

In Might, Wash. Gov. Jay Inslee (D) signed a sequence of payments designed to deal with the state’s housing points, relating notably to provide and housing affordability.

One such invoice is meant to “assist individuals who had been affected by racist housing covenants designed to maintain ethnic and spiritual minorities out of sure neighborhoods, in addition to their descendants, with down funds and shutting prices,” according to previous reporting by the Seattle Times. Sponsors say it’s the primary statewide invoice of its type.