Black Long Island homebuyers break barriers in competitive real estate market

After six years renting part of her sister’s house in Elmont, Roseline Louhis said she’s relieved to finally have more space for herself and her 10-year-old daughter, Delilah.

Louhis, 41, bought a four-bedroom town house in Bay Shore in December. It was her first home purchase and a major milestone after two years improving her credit, working overtime to save for a down payment and searching for the right property.

"For me and my daughter, it’s perfect," said Louhis, who emigrated to the U.S. from Haiti 17 years ago. "I wanted my own place for so long and we finally got it."

Louhis joined the ranks of homeowners on Long Island, where owning a home is far more common than in the rest of the country. Black people living on Long Island are also more likely to own homes compared to Black people in the rest of the U.S.

About 70% of Black households on Long Island owned their homes in 2023 compared to about 45% of Black households nationwide, according to the most recent one-year estimates from the U.S. Census Bureau’s American Community Survey.

But a home ownership gap remains between white and Black Long Islanders.

About 86% of white, non-Hispanic households on Long Island own their homes, a 16-point gap compared to the Black homeownership rate.

Gains in homeownership are an important marker of economic progress for families because they can help people attain financial stability, with fixed mortgage payments offering protecting from inflation that can drive up rents, said Michael Neal, a housing economist and senior fellow at the Urban Institute in Washington, D.C.

"Homeownership remains the American dream," Neal said. "Bein g able to purchase your home is a piece of what it means to be an American, and that's especially true for a group like Black Americans, who may feel like they have been denied or rejected from being a part of America for some part of this country's history." 

Black families in the U.S. tend to have less wealth than white households. That can be a significant disadvantage in today's competitive real estate market, local real estate agents said.

The steep rise in home prices in recent years favors buyers who get financial support from family members who can help boost the size of their down payments, said Jonathan Chandler a real estate agent at Compass in Rockville Centre. He represented Louhis in her Bay Shore purchase. 

"I’ve noticed families might help out in a way with down payment assistance and closing costs," Chandler said. "When you’re already dealing  with a disparity in ho meownership in the Black community, it’s that much harder to be able to close the gap."

Louhis purchased her town house for $480,000. She said she faced plenty of competition in the market and didn't rely on family to boost her down payment. Louhis paid about $5,000 above the asking price to land the deal, she said, and used some of her retirement savings to cover closing costs. 

"Right now, it's so challenging," Louhis said of the housing market. "Doing something like that on your own with a kid and not a big salary, it's a lot. But it's also something to be proud of."

 A legacy of discrimination 

Homeownership grew rapidly on Long Island after World War II, as government-backed, 30-year mortgages from the Federal Housing Administration and the Veterans Administration made buying a house accessible to many more people, said Tim Keogh, a history professor at Queensborough Community College.

But the federal government expanded those opportunities unequally, said Keogh, author of "In Levittown’s Shadow: Poverty in America’s Wealthiest Postwar Suburb."

FHA policies in the 1930s encouraged redlining — mortgage lenders' refusal to make home loans in Black neighborhoods — by not insuring those mortgages, which the agency deemed riskier. The FHA also recommended using restrictive covenants in property deeds, according to a Federal Reserve history of the practices.

Levitt and Sons and other large-scale developers of single-family homes on Long Island followed those guidelines, Keogh said. Even after the Supreme Court banned restrictive covenants in 1948, Black Long Islanders faced barriers to gaining wealth through homeownership.

As more Black homebuyers moved into white communities in the 1950s, real estate agents engaged in scare tactics, encouraging white families to move to other areas. That panic selling hurt property values and led the populations of areas such as Lakeview, Hempstead and Roosevelt to change from mostly white to mostly minority communities, Newsday previously reported.

More recently, Keogh noted, areas of Long Island with more Black and Hispanic homeowners had the highest rates of foreclosure during the subprime mortgage crisis, which likely lowered homeownership rates. 

"There's some people who didn't go back to homeownership," he said.

Black Long Islanders are significantly more likely to own their homes than Black households in the rest of the U.S., which reflects local zoning rules that favor single-family housing and permit rental apartments on less than 4% of the Island's land area, according to the Long Island Zoning Atlas.

But Newsday's 2019 Long Island Divided investigation also showed the ways Black homebuyers can be mistreated by real estate agents. It documented widespread and unequal treatment of minority homebuyers on Long Island as well as evidence some real estate agents steered fair housing testers toward certain communities based on their race or ethnicity. 

In response, Gov. Kathy Hochul passed a package of antidiscrimination bills in 2021 that increased fines and required more antibias training for real estate agents. Three brokerages agreed to pay a combined $115,000 in fines following an investigation by Attorney General Letitia James.

Pride in her purchase

Marjorie Theus, 63, said she regrets how long it took to purchase her home — a three-bedroom split-level in Baldwin. She bought the house in December for $730,000, tapping some of her retirement savings to pay for the down payment and closing costs.

Theus, an accountant, said the purchase was worth it because it allowed her to return to Long Island from Queens.

Theus used to live in a house in Huntington in the 1980s with her ex-husband. But after the couple separated, she moved with her two young sons to a rental apartment in Elmont. At that time, she said she didn't imagine she would ever be able to purchase a home. 

"I kind of gave up on that dream," she said.

About 20 years ago, she moved in with her then-boyfriend — now fiance — to his home in Queens. She thought she would save for a short period before buying a house. But the housing bubble drove home prices beyond what she felt comfortable spending.

"I knew I couldn't afford it then," Theus said.

Chandler, the real estate agent who worked with Theus on her purchase, said he has seen some Black first-time homebuyers overestimate how strong of a credit score or large a down payment they need to make a purchase and delay buying a house unnecessarily. He said they don't always have someone they can turn to for advice about making a major purchase like a home and sometimes lack trust in the real estate industry.

Financial education can help bridge the gap, said Gwen O'Shea, CEO of Community Development Long Island, which offers online classes and 1-on-1 coaching for first-time homebuyers.

"This is the biggest purchase you're going to make in your life, more than likely, and you need to have all the information to allow you to not only get over the finish line but then be successful and maintain that homeownership for the long term," she said.

About two years ago, Theus renewed her search for a home on Long Island with her fiance's support. 

She made four unsuccessful offers before finding the Baldwin property.

Theus said she takes pride in the purchase and looks forward to her investment in the home one day paying off for her children, who are in their 30s.

"If, God forbid, I go," she said, "at least I have something I could leave for my sons."

By Jonathan LaMantia

jonathan.lamantia@newsday.com@jonlamantia

Jonathan LaMantia covers residential real estate and other business news on Long Island. He previously covered the business of health care for Crain's New York Business.