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  • Writer's pictureJacob Hansen

Home Ownership and Wealth Gaps

The most broadly used wealth building tool in America is home ownership. Let’s ponder the effect that single motherhood has on ones chance of having the money to purchase a home. It seems like common sense that single moms who are burdened with taking on the immense challenge of providing for a family and raising children all by themselves would be less likely to be home owners. Data shows this to be true.

On average...

31% of single moms own a home Source

84% of married couples own a home Source

Given these facts we can surmise that if group A has a 70% single motherhood rate and group B has a 30% single motherhood rate, it logically follows that group A will have less home ownership then group B. Doing some simple math we can even project how much home ownership we would expect in each group and what the difference would be.

Group A: 46% expected home ownership rate

Group B: 69% expected home ownership rate

It is often claimed that differences in home ownership (and the resulting wealth gap) between blacks and whites is being driven by racism. However, when we account for the fact that blacks have a single motherhood rate of about 72% and whites have a single motherhood rate of about 29% its should not be a shock when we see differences in home ownership rates and the resulting wealth. In fact, when we see a home ownership rate of 45% for blacks and 72% for whites we are seeing almost exactly what we would expect given the single motherhood rates. Obviously single parenthood is not the only factor driving differences in home ownership but the data clearly supports what we all intuitively know, that buying a home is much easier in a 2 parent situation than as a single mother. As long as the black and white communities have such large differences in single motherhood rates we will continue to see this disparity in home ownership and the resulting wealth.

But wasn’t it racism that broke the black family? This sounds plausible until you realize the black family was 3x stronger under Jim Crow than it is today. If racism was driving the breakup of the black family why would we see less family breakup in 1950s Alabama than we do in 2020 California. The data does not match the narrative.

So what did cause the breakup of the black family? In a recent video I go through the data and the findings of great scholars like Thomas Sowell who shows conclusively the economic, political and social factors that destroyed the black family.

Until we properly diagnose what is driving the disparities between black and white communities we will not be able to solve the problems and instead will continue to drive social and political wedges and cause more suffering.

For a full exploration of the causes of black vs white wealth disparities please refer to my recent debate with Dr. David Preece.

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