Massachusetts is segregated. Here’s why.

Stacked condos on the Charles River in Cambridge.David L. Ryan/Globe Staff/David L Ryan, Globe Staff

Massachusetts’ cities and towns remain starkly segregated, with most Black families buying homes in only a handful of places, mostly in Southeastern Massachusetts, according to recent banking and census data.

Why? It’s complicated. But here are some of the factors at play.

• The segregation of Massachusetts communities has been forged by a legacy of discrimination, including redlining, in which banks refused to grant loans to Black and brown households in certain ZIP codes. And local “Not in My Back Yard” zoning rules have historically prevented the development of affordable homes, including multiunit developments. “Not enough communities are pulling their weight and building home ownership opportunities,” said Thomas Callahan, of the Massachusetts Community Banking Council, which produced a report in partnership with the UMass Donahue Institute, Economic and Public Policy Research, that highlighted racial discrepancies in loan approvals and rejections across Massachusetts. To change that legacy, Callahan said, suburban towns need to change their zoning policies.
• The real estate industry also influences the housing market and how people choose where to live. Do real estate agencies and brokers steer clients to one community over another because of a buyer’s race or ethnicity? The practice is illegal, but it happens, analysts said. And how diverse are real estate firms and mortgage firms, and how often do they engage with and market themselves to different communities?
• While certain “gateway communities,” such as Fall River and Brockton, have a reputation for having houses for sale that are affordable and being welcoming to immigrants and lower-income families, it’s the “gateway adjacent” communities that could do more to open their doors, housing analysts said. Nearly half of all loans to Black households in 2019 were concentrated in just five communities. But equally important, the data show, is where Black residents are not moving and buying homes — in 2019, there were 130 municipalities in which not a single Black borrower received a loan.

The Community Banking Council report also found that Black and Latino homebuyers are far more likely than white buyers to be denied mortgage opportunities, including when comparing the same income levels, and particularly in Boston. Denials for Black buyers stood out even after considering their groupwide lower average income and down payment capacity, the report found.

• But there also just aren’t enough houses being built to meet the demand in the first place. “The first thing is the lack of new housing construction,” said Callahan. It comes down to supply and demand, he said. More people are moving to the area, creating a regional crunch. Suburban towns must also build more housing to address the demand, creating equal opportunities for people of all races. And that means actual affordable homes to buy, not just rental units, Callahan said. Home ownership is a way to build wealth. And most renters, he said, want to buy a home.
• In the city, there aren’t enough new affordable homes. It’s one thing to build a $2 million condo in Boston’s Seaport, but that does nothing to help low- and middle-income families looking to purchase their first home. “People are just literally priced out, it’s not in their ball park,” said Darwin Caffrey, a loan officer with Fairway Mortgage Independent Corp., who has seen more and more clients choosing to live in towns south of Boston. “I have to tell them Boston’s not happening. It’s not in their ballpark.”
• Caffrey, who grew up in Brockton and lived a short time in Braintree, said many of his clients of color, including those who are priced out of Boston, choose communities that are familiar to them, such as Brockton or Randolph, Avon or Stoughton. And that’s not a bad thing, he said; they may want a neighbor who looks like them, or to have businesses and restaurants that cater to their particular culture, such as in the Haitian and Cape Verde communities south of Boston. They may have a relative or friend who already lives there, or they know about a particular church. “I think it’s a cultural thing, people do watch out for one another,” he said.

But that want for familiarity, he and Callahan said, is also partly rooted in a community’s reputation for how welcoming it can be — or not.

“What are the things that you are doing to invite people who may not know about your community, into your community,” he said. “It’s putting out a welcome flag.”