Is racism blighting the mortgage industry?
Two stories in the past week make suggestions of racism in the home loan
industry. In New York a lawsuit has been filed by a non-profit housing group, claiming that M&T Bank used racial criteria in making lending decisions. MPA reported yesterday
that The Fair Housing Justice Center says it conducted research between 2013 and 2014 using nine women of various racial backgrounds who posed as homebuyers.
It says that M&T steered those from minority backgrounds to minority neighborhoods and also gave them lower estimations of how much they would be able to borrow. The bank has issued a statement denying the allegations and stating its commitment to fair lending.
Separately, Zillow has conducted a study
which shows that Black and Hispanic applicants are turned down for home loan
s twice as often as white or Asian applicants.
“While many of the disparities between the experiences of white communities and minority communities during the housing boom and bust can be explained by plain differences in finances and geography, it's clear that the housing playing field remains strikingly unequal in this country," said Zillow Chief Economist Stan Humphries.
The discrepancy is most intense in some of the nation's most volatile markets. Home values in both black and Hispanic communities in the Los Angeles area remain more than 20% below their pre-recession peaks, while homes in Los Angeles' Asian communities have appreciated beyond those peaks, and homes in white neighborhoods are almost at peak levels.
Shady foreign investors who stash their cash in U.S. real estate
The New York Times
has published a report into the world of foreign investment in U.S. real estate. While there are many legitimate overseas investors who buy homes and commercial property here because it is a far safer investment than the property markets in their own countries, there are also those who use anomalies in our tax system.
Some investors have used those to stash their sometimes illegally obtained fortunes. U.S. law allows the use of shell companies as investment vehicles and the investors are often able to set up a limited liability corporation without disclosing their identity, making it very difficult for authorities to track them down. Read the full report.
Home with a history: Blackbeard’s castle hits the market
The notorious 18th
century pirate Blackbeard chose the U.S. Virgin Islands as his home and now his former residence is back on the market.
The home is part of an estate being sold by a family which has owned it since 1967, but Blackbeard’s Castle is the star attraction. The estate boasts eight buildings, including a hotel, and has stunning views, especially from Blackbeard’s Hill. The sellers are keen that the history of the site is maintained, so will be choosing their buyers carefully.
The price tag? A cool $18 million.