By: Cynthia Swain-Tibbs
The under-valuation of the necessity of real estate investments by African-American young adults leading to gentrification.
This article is the introduction and first of a series of essays and media on this and other subjects relevant to the economic development of native African-American (A-A) people. In this first of a series, my intent is to describe the cycle of economic strategies and decline that have taken place in traditional A-A urban communities in major U.S. cities causing loss of land and decline in homeownership of thousands of A-A families. I really want you to know and understand what I’m saying about historical wealth loss, especially in communities where descendants of slaves, have lived for the last 157 years of “freedom”.
- Land: the surface of the earth; starts at the center/core of the earth, passes through the earth’s surface, and continues on into space.
- Real Estate: land and its improvements (houses, buildings, etc.) in a physical sense, as well as the right to own or use the land
- Real Property: ownership rights in land and its improvements
- Colonization: foreign control over target territories (or peoples) for the purpose of taking over political control and re-cultivation often by establishing and settling colonies.
- Social Integration: process by which separate groups are combined into a unified society, especially when this is pursued as a deliberate policy.
- Assimilation: process whereby individuals or groups of differing ethnic heritage are absorbed into the dominant culture of a society.
- Gentrification: process, either planned or unplanned, where wealthy or affluent middle-class and college-educated individuals begin to move into under-valued or traditionally working-class communities, to displace less-affluent individuals by purchasing and improving or upgrading property through new construction, renovation, and modernization.
In the real estate profession, we use the term under-valued, when a property is not accurately appraised according to its highest and best use, location, market conditions and/or similar sales within the same community. Under-valuation is a very well-known and documented problem in A-A urban communities across the country.
The problem of colonization has continually existed in communities of color on every continent. In Houston, its effect can be seen in the declining rates of A-A homeownership and real estate investments in communities like Third, Fourth, and Fifth Wards, Kashmere Gardens, Pleasantville, Acres Homes, Settegast, and Sunnyside.
Colonization has now been renamed to give the term a more acceptable and different meaning than its historical record implies. When other people recognize the value of our property based on location and affordability, then those wealthy enough to take advantage of the lower valued properties begin to buy, develop, and settle there. Eventually they grow in numbers, take control of the political climate, and erode the original culture of that community. The colonization process is now known as gentrification.
Just 30 years ago, Houston’s largest A-A communities included low and high-income as well as blue and white-collar residents and businesses. Their common denominator was “the segregation of the Negro in the United States.” Currently the A-A population of these communities is rapidly declining. Those who can afford to move to areas such as the Woodlands, Kingwood, or Pearland are selling or abandoning their ancestral properties to for the glamour of large suburban homes. Those who remain are experiencing declining cultural and religious services, as well as higher taxes and rents because of gentrification. We are literally losing our ground and its wealth
In future articles I will discuss the following contributing issues for our loss:
- Many AA’s do not understand how to build wealth from owning real estate.
- Many A-A’s don’t understand the legalities and responsibilities of owning real estate.
- Many A-A’s don’t use wills and other estate planning to transfer their wealth responsibly.
- Many A-A’s don’t understand how real estate agents can help maximize proceeds before selling their property.
- The county appraisals in A-A communities are habitually under-valued, until after gentrification has occurred.
- Real estate appraisers discriminate in estimating the value of properties located in or owned by people or communities of color.
Please watch for my next articles about this very important topic.