But Are We Ready To Talk About Black Flight?

The “woke” among us talk incessantly about white flight and redlining. For those unfamiliar with the terms:Redlining, which has been illegal for over 40 years, was the practice of banks only approving mortgage applications to African Americans in neighborhoods marked hazardous in red ink on maps drawn up by the Federal Home Owners’ Loan Corp. They were largely denied mortgages outside of redlined areas. While this practice has been illegal for decades, studies show that more than 70% of the communities that were redlined still struggle economically today. The aftershocks of redlining is still felt and is visibly evident when driving around neighborhoods that were redlined but haven’t yet been gentrified.

White Flight was the mass exodus of whites from inner cities to the spacious homes, green lawns and white picket fences of the suburbs. They fled in droves as blacks moved into neighborhoods that had been largely white. Most believe White Flight occurred in the Post World War II era. Some argue that white flight actually started much earlier. There is documented evidence of whites fleeing as early as when blacks originally migrated from the South into Northern states. Blacks came from the South, looking for better lives and fair pay, and planted roots in roughly a dozen or so major US cities. Whether they left before or after the WWII era, we know that by the time the crack epidemic of the ‘80s ravaged inner cities, white folks were already gone.

Black parents and grandparents fought the good fight of raising a family in poverty in the same communities that whites fled. Out of (what looked like) total despair, those same ghettos produced a wave of newly educated blacks. Some of us managed to get a decent early education (K-12) and many of us became 1st and 2nd generation college educated. My mother was the first in our family to ever graduate from college. She dodged the crack bullet that many of her friends fell victim to.

Now that I am an adult, and second generation college grad, who grew up in the toughest parts of Philly, I’ve noticed something eerily familiar…but this time it’s Black Flight. The folks I grew up with or went to school with have long since fled “the ghetto”. Oddly enough, whites seemed to finally be exhausted of the long commutes from the burbs into the city and are moving back into inner cities while blacks who grew up in these hoods refuse to live OR invest in “crackhouses”.

Studies have recently been done that suggest the median net worth of blacks in America will be $0 by 2053. I point this out because a significant part of how all Americans gain wealth is through home equity—the value of a home less the debt on it. As we see significantly higher growth in the same hoods that blacks consider too ghetto to invest in (but are also seeing the most rapid equity appreciation) we need to think differently.

For those of us that can’t be in the city because of jobs or because you need access to better school districts, I get it. But you don’t have to live there to invest there. I need US to be participants in the massive amounts of wealth being created in the same hoods we left. So don’t let your grandma and auntie’s house go. Let it become the legacy your ancestors never expected. Peace fam.

Responses

  1. This is a great example on how we have the power to have generational wealth and can make a difference. Great story!

  2. Exactly! This is what we believe in and is the majority of our investment business. Great intro and summary of the opportunities that so many of US are overlooking or dismissing.