Perhaps Unwittingly, Trump Praised Record Levels of Black Home Ownership Nationally
Perhaps Donald Trump can be forgiven for his transgression. With the U.S. economy running at its briskest pace since the mid-2000s, he may have over-zealously gone too far. In front of a packed house of 12,000 people in Pensacola, Florida last Friday, Trump stated that record levels of black home ownership are present in America. But is that really true? We examine.
Of course, Trump used the stump in Pensacola to tout his many economic achievements since being elected president. He rightfully spoke about the near-daily stock market highs and three-percent-plus growth in the last two quarters (something Barack Obama failed to achieve in eight years). He talked about how tax reform was going to benefit Joe America and many points in between. But Trump may have bitten off more than he could chew on the subject of black home ownership rates.
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Here’s Trump on black home ownership in 2017:
“Look at these guys, ‘blacks for Trump.’ I love you. I love you. By the way, now that you bring it up, black homeownership just hit the highest level it has ever been in the history of our country. Congratulations.” (Source: AP Fact Check: Trump Wrong on Black Homeownership, Trade, Wages, Voice Of America, December 10, 2017)
If he was talking about a decade ago, that may have been true. Nowadays, not so much. A cursory glance at overall home ownership statistics paints a clear picture why. In fact, the trend toward falling ownership rates began even before the U.S. housing bubble popped, purging many financially insecure couples from the market.
According to the U.S. Census Bureau, the black home ownership rate peaked during 2004, when 49.7 percent controlled a dwelling. This fell to the mid-40s in the year following the Great Recession, when both a recession and tougher lending practices hammered new loan creation. Currently, that number is down to only 42%, the low-water mark for the year and a decrease of 0.7% from Q1 2017 levels.
Black Home Ownership Rate, Each Quarter Since 2016
| Year/Quarter | African-American Rate (%) |
| 2017 | |
| Third Quarter | 42.0 |
| Second Quarter | 42.3 |
| First Quarter | 42.7 |
| 2016 | |
| Fourth Quarter | 41.7 |
| Third Quarter | 41.3 |
| Second Quarter | 41.7 |
| First Quarter | 41.5 |
(Source: “Quarterly Residential Vacancies and Homeownership, Third Quarter 2017,” U.S. Census Bureau, October 31, 2017.)
It’s worth noting that, although longer-term statistics don’t support Trump’s version, short-term ones are more accommodating. Black home ownership actually rose a full percentage point in Q1 2017, the first quarter with Trump in office. Overall, rates are higher than they were during Barack Obama’s last term, which makes Trump technically correct.
But still, winning on a micro-technicality doesn’t do the full picture justice.
Home Ownership Is Down Across the Board
It’s been tough sledding for home ownership rates across the board in the United States. This trend stretches to the mid-2000s, when lending standards and credit quality came under increased scrutiny. As we can see from the chart above, rates are just starting to rebound from the cyclical low in Q2 2016.
With home ownership rates only about one percent off the bottom, we can barely call it a “trend.” But it’s a start, one that Trump will gladly claim credit for. As he should. Trump’s pro-growth and “America First” economic policies are clearly having a positive effect. We can see this in the soaring business confidence numbers; the above-three percent gross domestic product (GDP) growth; and, ultimately, bouncing home ownership rates.
It will be interesting to see whether the just-emerging trend of rising ownership rates continues, especially for the black community. Wages are showing signs of life, and U.S. payrolls added 228,000 jobs last month. There’s even chatter in the media about a looming labor shortage, brought forth by less immigration feeding the labor pool. If so, that promises to be a major boon for ownership rates going forward, particular those at the low end of the economic stratosphere.
Verdict
If we’re talking about black home ownership along macro trendlines, Trump certainly erred in claiming that participation rates are rising. Not only are they not rising from African Americans, they are not rising from all Americans in general. The downward trend has been persistent and ongoing since 2005.
On micro level, a defensible case for Trump can be made. Black home ownership rates are higher (albeit it, negligibly) since Trump took office. But that’s a stretch, considering that levels have fallen in every quarter in 2017, and remain only 0.3% higher than in Q4 2016.
Still, a win is a win, and Trump took full advantage by touting this fact on Friday.
