The Role of Place in Socioeconomic Mobility and Racial Equity

— An excerpt from the new book, Furthering Fair Housing: Prospects for Racial Justice in America’s Neighborhoods

Book cover graphic combining a generic city map, family members and residences along the street.
(Courtesy of Temple University Press)

Over the past half-century, socioeconomic mobility in the United States has declined dramatically. Ninetypercent of children born in the 1940s grew up to earn more than their parents, compared to only 50 percent ofchildren born in the 1980s.[1] These backward steps have not been experienced evenly. As socioeconomic mobility has declined broadly across America, the economic gains experienced by African Americanhouseholds immediately following the civil rights movement have largely reversed. The majority ofAfrican American households whose parents were in the middle class in the post–civil rights era have experienced downward mobility since, moving lower in the income distribution today than they were intheir parents’ generation.[2]

These uneven declines in socioeconomic mobility can be understood in part through the role that place plays in shaping a child’s chances of moving up, or down, economic and social ladders. Neighborhood characteristics and resources are strong predictors of upward socio-economic mobility, especially for children starting out in the lower half of the income distribution; for African American and Latinx young adults, whose neighborhoods are by and large physically separate and materially unequal from the neighborhoods in which white young adults grow up, neighborhood characteristics are powerful predictors of educational and economic attainment.[3]

The significance of place in shaping life chances is intertwined with a widening racial wealth gap. For the majority of U.S. homeowners, their homes are their most valuable assets. Thus, one factor contributing to the substantial racial and ethnic disparities in wealth is the disparity in rates of homeownership as well as the substantial disparities in the financial returns of homeownership. Homeownership rates in the United States reached record highs in 2004 and 2005, when more than three out of every four (76 percent) white non-Hispanic households were home-owners. But even at this peak, only roughly half of Black households (49 percent) and Latinx households (50 percent) owned their own homes.[4] The economic growth in the first decade of the 2000s and the devastating recession beginning in 2008 were caused in part by the increased global investment in U.S. homes, commodified through thepackaging of home mortgage loans into securities. The precipitous decline in home values and the increasedrate of foreclosures after 2008 contributed to a widening of the racial wealth gap between white and non-whitehouseholds. In 2016, the median white household had a net worth of $171,000, nearly ten times the medianBlack household’s net worth of $17,600 and roughly eight times the median Latinx household’s net worth of$20,700.[5] By 2019, the white homeownership rate had fallen to 73 percent, while the Blackhomeownership rate had fallen to 41 percent and the Latinx rate to 47 percent — leaving a 26 to 32 percentagepoint gap in homeownership rates by race and ethnicity.[6] Further, looking solely at those who do own theirhomes, white homeowners have substantially more net housing wealth, or home equity, than non-whitehomeowners.[7]

As homeownership rates have declined over the past decade, housing costs for renters have risen — inmany cities, faster than renters’ incomes. In 2019, nearly half (48.4%) of renter households who paid cash rent paid 30% or more of their income on housing costs.[8] The financial and housing instability experienced by households with low and moderate incomes associated with the rising share of income going to rent has substantial negative effects on health and economic security. There are also stark disparities by race, ethnicity, and family status in access to stable, decent, affordable housing. The Department of Housing and Urban Development (HUD) defines “worst case housing needs” as those experienced by households with very low incomes that do not receive government housing assistance and pay more than one-half of their incomes toward rent, those that live in severely inadequate conditions, or both, and notes that these worst case needs have increased 54 percent between 2001 and 2017.[9] Roughly three out of every four Black households with very low incomes and renting on the private market without housing assistance had worst case housing needs in 2017.[10]

A home, of course, is much more than just an asset or a place to sleep. As discussed above, the level and quality of neighborhood-based resources are powerful predictors of individual life chances. The condition, security of tenure, and location of one’s home, whether owned or rented, all have substantial impacts on one’s health, well-being, and socioeconomic mobility. The structure of governance in the United States makes access to crucial public services and resources, such as schools or policing, dependent on the location of one’s home.[11] In consequence, the level or quality of these services varies substantially based on jurisdiction or neighborhood. Indeed, differentiation by residential location in the United States is part of a spatial structure that organizes our social lives.[12] Neighborhoods are not just separated by race, ethnicity, and income; they are also unequal.[13] Just as we shape our neighborhoods, our neighborhoods also shape our families across generations, and the inequality of thoseneighborhoods must be conceptualized as a central dimension of social stratification and racial inequality in the United States.[14]

When Congress passed the Fair Housing Act in 1968, it set out the goal of providing for fair housing throughout the nation and fulfilling two promises. First, the Fair Housing Act prohibited discrimination in housing on the basis of race, color, religion, and sex (and subsequently, after the Fair Housing Amendments Act of 1988, disability or handicap, familial status, and national origin).[15] Second, the Fair Housing Act required that “all executive departments and agencies shall administer their programs and activities relating to housing and urban development (including any Federal agency having regulatory or supervisory authority over financial institutions) in a manner affirmatively to further” fair housing.[16] Although discrimination in housing is still distressingly common, substantial progress has been made in the first goal of ending that discrimination. The Fair Housing Act’s second mandate, however, to take active steps to reduce disparities in access to place-based opportunities, essentially withered on the vine for the half-century following the Fair Housing Act’s passage.

Leadership at HUD under President Barack Obama made it a priority to give life to the Fair Housing Act’s unfulfilled commitment to affirmatively further fair housing. After seven years of community engagement and careful efforts by individuals throughout HUD to craft a meaningful rule, then HUD secretary, Julián Castro, on July 15, 2015 announced the finalization of the Affirmatively Furthering Fair Housing (AFFH) Rule, the most significant federal effort in a generation to address the separate and unequal pattern of U.S. urban development and to increase equality of access to place-based resources, such as high-performing schools or jobs.[17] HUD defined affirmatively furthering fair housing as “taking meaningful actions that, taken together, address significant disparities in housing needs and in access to opportunity, replacing segregated living patterns with truly integrated and balanced living patterns, transforming racially and ethnically concentrated areas of poverty into areas of opportunity, and fostering and maintaining compliance with civil rights and fair housing laws.”[18] It emphasized the need for “individuals and families [to] have the information, opportunity, and options to live where they choose without unlawful discrimination and other barriers related to race, color, religion, sex, familial status, national origin, or disability.”[19]

The AFFH Rule required HUD to provide its grant recipients with uniform data about residential segregation and disparities in access to place-based resources and opportunities, and HUD created a publicly accessible website that generates customized maps and tables for each jurisdiction and its surrounding region. The rule requires all public entities that receive HUD funding to engage with their residents to create locally tailored strategies to address disparities by race, national origin, family status, disability, and other protected characteristics in access to decent housing, quality schools, proximity to employment, exposure to environmental hazards, and other dimensions of fair housing. The rule then requires municipalities to submit plans to HUD, called Assessments of Fair Housing (AFHs). By mandating local creation of specific measurable goals to increase equality of access to opportunity, the AFHs link these planning and assessment efforts to the availability of future HUD funding. The first local submissions of AFHs pursuant to the AFFH Rule began in 2016 and continued through 2017 until HUD under Donald Trump suspended the Rule.[20]

Increasing rent burdens for households with low and moderate incomes over the past decade have contributed to the rise of the most active local and national movements for affordable housing in recentmemory that brought renewed attention to the now suspended AFFH Rule. In 2018 and 2019, tenants’rights activists in Oregon and California won the passage of state laws enabling rent regulation, while tenantsin New York strengthened existing rent regulations. Affordable housing organizers in Minneapolisworked with the mayor and city council to enact a “Minneapolis 2040” plan that changed zoning: acrossthe roughly 75 percent of the city previously zoned for single-family homes, construction of three-family(or more) homes is now generally allowed.[21] Similarly, the Oregon state legislature enacted a law in 2019requiring the creation of multifamily zoning in municipalities statewide. At the same time, conversationsabout white supremacy and racial equity, especially after the rise of the Black Lives Matter movement, continue tocapture public attention and spur a focus on the wide and persistent racial wealth gap as well as racialdisparities in access to safe, stable, and affordable housing.

Because housing policy lies at the intersection of declining socioeconomic mobility and persistentracial and ethnic inequality in wealth and income, housing in recent years has become an issue of greatersignificance in national politics than has been seen in decades. From mortgage under-writing toforeclosures, rent regulation to evictions, housing cost burdens to exclusionary zoning, gentrification andYes in My Backyard (YIMBY) organizations, housing policy issues have inspired an array ofcontemporary local and national social movements.

The AFFH Rule connects these movements to the ongoing struggle for racial equality. It also createsleverage to make real changes in local and regional policy. Nationally, the AFFH Rule has been referencedand expanded upon by a range of actors. Democratic presidential candidates in the 2020 cycle, includingBernie Sanders, Elizabeth Warren, Cory Booker, Kamala Harris, Pete Buttigieg, Amy Klobuchar, andformer HUD secretary Julián Castro, all released housing plans that, at least in part, aimed to addressdisparities in access to place-based resources and opportunities. Sanders proposed national just-causeeviction requirements and rent regulation as well as in- vestments in public housing and housing choicevouchers. He also proposed making federal housing and transportation funds contingent on remedying restrictive zoning ordinances and using HUD’s authority to encourage state and local land-use policiesthat advance racial, economic, and disability integration. Warren proposed an expansive plan to reformland-use rules that restrict affordable housing construction and further racial segregation andrecommended investments that would begin to close the racial wealth gap through targeted homeownershipassistance. Warren’s proposal also increased funding for public housing and strengthened protections forrenters. Castro released a detailed plan to expand the housing choice voucher program, prohibitdiscrimination based on source of income, create a renters’ tax credit, invest in subsidized housing, createfederal land-use guidelines, and to use an expanded CDBG program to require zoning reforms that wouldadvance fair housing and reduce racial disparities. Harris proposed a federal tax credit designed to ease theburden of rents for low- and moderate-income households. Booker proposed a federal tax credit for renterspaying more than 30 percent of their income on rent and offered policies designed to restrain exclusionaryzoning.

The eventual Democratic party candidate, Joe Biden, ultimately pro- posed a plan also aiming todirectly address place-based racial disparities. His plan included restoring and implementing the AFFHRule, conditioning receipt of federal CDBG and transportation funding on the elimination of exclusionaryzoning regulations, strengthening the Community Rein- vestment Act, maintaining existing disparateimpact liability under the Fair Housing Act, reinstating the power of the Consumer Financial Protection Bureau to investigate discriminatory lending, providing housing choice vouchers to all eligiblehouseholds, creating a new first-time homebuyer tax credit, creating a new renter’s tax credit, helpingtenants facing eviction access legal assistance, and allocating increased funding and tax credits to affordablehousing production. Perhaps just as important as the details of any of these plans is the fact that thesepresidential candidates generated new public dialogue about housing affordability and racialized wealth disparities that had been largely absent from previous campaigns.

This public dialogue is further strengthened by the immense power exercised through protest, particularlyin the wake of the intertwined health, social, economic, and political crises of 2020. The unprecedentedforce of the 2020 resurgence of the Black Lives Matter movement has moved conversations about thepervasiveness of white supremacy in U.S. society to the forefront, contributing to significant changes inpublic perception about racial discrimination, particularly among white audiences. The movement hassharpened this growing recognition of the nature of racial discrimination faced by Black Americans,providing a clearer lens through which to view the AFFH Rule.

In 2016, the Movement for Black Lives platform articulated a call to end the war on Black people and a call for reparations — including reparations to atone for long-standing housing discrimination. In addition, the movement demanded divestment from policing and prisons; investment in education and health care; community control over schools and public safety, together with participatory budgeting processes; and reforms to existing political processes that would support independent Black political power and Black self-determination. The platform also called for economic justice, including reforming the tax code, strengthening workers’ rights, devoting resources to encourage cooperative or collective ownership, and delivering a right to land, clean air, clean water, and housing. Although the 2020 protests were sparked initially by police violence in a context of enduring white supremacy, the participation of millions of Americans nationwide helped underscore a growing understanding that racism must be understood not as individualized prejudice but as systematic white supremacist subordination, as ideologies, policies, and practices that normalize and perpetuate racialized inequalities. This movement pointedly underscores the deep historical roots undergirding the AFFH Rule, giving it renewed urgency. Seen this way, the racialized disparities in homeownership rates or neighborhood resources that the rule was designed in part to address must be seen as products of racism and a white supremacist social and economic order.

In response to the momentum of the Black Lives Matter movement, Donald Trump countered by continuing to stoke division, especially along racial lines. Among many elements of his response, he reasserted his resentment of protestors and dissent, reaffirmed support for white supremacists, and continued to double down on his racist and divisive rhetoric. Reminiscent of his 2016 campaign, his calls for “law and order” were shouted over the calls for justice, even as protests continued through all fifty states throughout the summer. His actions illuminated a clear connection between racist ideologies and the policy decisions that uphold these divisions, especially urban and regional policies that continue to enable neighborhood-based socioeconomic and racial inequality. In July he tweeted:

At the request of many great Americans who live in the Suburbs, and others, I am studying theAFFH housing regulation that is having a devastating impact on these once thriving Suburbanareas. Corrupt Joe Biden wants to make them much worse. Not fair to homeowners, I may end!

Critics and pundits widely viewed Trump’s invocation of the AFFH Rule as an attempt to reversedeclining suburban support by further inflaming racial divides. In the following weeks, Trump continuedthis rhetoric, evoking segregationist fearmongering. He claimed that because of the AFFH Rule, “Yourhome will go down in value and crime rates will rapidly rise” and that the rule “will totally destroy thebeautiful suburbs. Suburbia will be no longer as we know it.”[22] On August 7, 2020, the Trump administration issued a final rule titled “Preserving Community and Housing Choice” that repealed the2015 AFFH Rule.[23]

These statements that presaged the rule’s repeal highlight the ways that the struggle for racial justice is intertwined with housing, land use, and local governance. The statements clarified and amplified what is atstake in the fight to revive — or “end” — the AFFH Rule. Addressing racial disparities in housing producedby white exclusion and resource hoarding requires a complex reimagining of multiple dimensions of ourcollective ways of life. The work of the AFFH Rule is to root out the ways in which white supremacy hasbecome physically embedded in the American landscape.

Adapted from Steil, J. P., Kelly, N. F., Vale, L. J., & Woluchem, M. S., eds. Furthering Fair Housing: Prospects for Racial Justice in America’s Neighborhoods. Used by permission of Temple University Press.
© 2021 by Temple University. All Rights Reserved.

[1] Raj Chetty, Nathaniel Hendren, Patrick Kline, Emmanuel Saez, and Nicholas Turner, “Is the United States Still a Land of Opportunity? Recent Trends in Intergenerational Mobility,” American Economic Review 104, no. 5 (2014): 141–147.

[2] Patrick Sharkey, Stuck in Place: Urban Neighborhoods and the End of Progress toward Racial Equality (Chicago: University of Chicago Press, 2013), p. 4.

[3] Chetty et al., “Where Is the Land of Opportunity?”; Jorge De la Roca, Ingrid Gould Ellen, and Katherine M. O’Regan, “Race and Neighborhoods in the 21st Century: What Does Segregation Mean Today?” Regional Science and Urban Economics 47 (July 2014): 138–151; Sean F. Reardon and Kendra Bischoff, “Income Inequality and Income Segregation,” American Journal of Sociology 116 (2011): 1092–1153; Jorge De la Roca, Ingrid Gould Ellen, and Justin Steil, “Does Segregation Matter for Latinos?” Journal of Housing Economics 40 (June 2018): 129–141.; Sharkey, Stuck in Place; Ingrid Gould Ellen, Justin P. Steil, and Jorge De la Roca, “The Significance of Segregation in the 21st Century,” City and Community 15, no. 1 (2016): 8–13.

[4] U.S. Department of Commerce, Bureau of the Census, “Housing Vacancies and Homeownership. Table 16: Quarterly Homeownership Rates by Race and Ethnicity of Householder: 1994 to Present,” 2019, available at https://www .census .gov/housing /hvs/data /histtabs .html.

[5] Jesse Bricker et al., “Changes in U.S. Family Finances from 2013 to 2016: Evidence from the Survey of Consumer Finances,” Federal Reserve Bulletin 103, no. 3 (2017), available at https://www.federalreserve .gov/publications/2017-September-changes-in-us-family-finances-from-2013-to-2016.htm.

[6] U.S. Department of Commerce, Bureau of the Census, “Housing Vacancies and Homeownership.”

[7] Bricker et al., “Changes in U.S. Family Finances from 2013 to 2016.”

[8] U.S. Census Bureau. 2019 American Community Survey (2019).

[9] U.S. Department of Housing and Urban Development, Office of Police Development and Research. Worst Case Housing Needs: 2019 Report to Congress (June 2020). P. iii.

[10] U.S. Department of Housing and Urban Development, Office of Police Development and Research. Worst Case Housing Needs: 2019 Report to Congress (June 2020). P. 6.

[11] Yonah Freemark, Justin Steil, and Kathleen Thelen, “Varieties of Urbanism: A Comparative View of Inequality and the Dual Dimensions of Metropolitan Fragmentation,” Politics and Society (2020), available at .1177/0032329220908966.

[12] Robert J. Sampson, Great American City: Chicago and the Enduring Neighborhood Effect (Chicago: University of Chicago Press, 2012), 21; Justin P. Steil and Laura Humm Delgado, “Limits of Diversity: Jane Jacobs, the Just City, and Anti- subordination,” Cities 91 (2019): 39–48.

[13] De la Roca, Ellen, and O’Regan, “Race and Neighborhoods in the 21st Century.”

[14] Sharkey, Stuck in Place, 6.

[15] See Section 804(a), which makes it unlawful “to refuse to sell or rent after the making of a bona fide offer, or to refuse to negotiate for the sale or rental of, or otherwise make unavailable or deny, a dwelling to any person because of race, color, religion, sex, familial status, or national origin” (42 U.S.C. § 3608(d)); and Section 804(b), which provides that “it shall be unlawful for any person or other entity whose business includes engaging in real estate- related transactions to discriminate against any person in making available such a transaction, or in the terms or conditions of such a transaction, because of race, color, religion, sex, handicap, familial status, or national origin” (42 U.S.C. § 3608(e)).

[16] Sec. 808(d), codified as 42 U.S.C. 3608(d).

[17] Affirmatively Furthering Fair Housing Rule, 80 Fed. Reg. 42271–371, July 16, 2015.

[18] Affirmatively Furthering Fair Housing Rule, 80 Fed. Reg. 42353, July 16, 2015.

[19] Affirmatively Furthering Fair Housing Rule, 80 Fed. Reg. 42354, July 16, 2015.

[20] Affirmatively Furthering Fair Housing: Extension of Deadline for Submission of Assessment of Fair Housing for Consolidated Plan Participants, 83 Fed. Reg. 683–85, Jan. 5, 2018

[21] “Minneapolis 2040,” accessed May 12, 2019, available at https://

[22] Kevin Liptak, “Trump Pitches White Suburban Voters in Blatantly Political White House Event,” CNN, July 16, 2020, available at

[23] Preserving Community and Neighborhood Choice, 85 Fed. Reg. 47899–47912, August 7, 2020.

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