The long-term effects of the burst housing bubble
Nationwide, African Americans were disproportionately impacted by recent the mortgage crisis. Prince George’s County, the wealthiest majority-black county in the United States, was also the epicenter for mortgage failures in Maryland. MPRC faculty associate Kris Marsh described the demographic changes that occurred in her own Prince George's County neighborhood as a result of the housing crisis.
Marsh lives in Fairwood, an affluent majority-black neighborhood ravaged by the effects of the burst housing bubble. Built on a former slave plantation, Fairwood was once a shining example of black economic success. Many of the homes there once sold for more than $1 million. “Ten years ago, this was the up-and-coming black area,” Marsh said. But the recent economic crisis took a heavy toll on families in Fairwood. A large percentage of Fairwood residents bought their homes with risky subprime loans, many of which ended in foreclosure. Property values in the area plummeted, displacing many families and allowing less wealthy people to move in. The neighborhood is now less affluent and less black than it once was.
Marsh says, “As a resident, I welcome and celebrate the socioeconomic and family type of diversity present in Fairwood. As a sociologist and demographer, I am troubled that Fairwood was hit hard in the housing crisis, especially given the number of black Fairwood residents. It begs the hypothetical yet sociological question: Would the same magnitude of predatory lending have taken place in Fairwood if it were a predominantly white middle-class area?”