Pictured above: Wenfei Xu, an assistant professor of geography at UC Santa Barbara, co-authored the study “New Deal mortgage programmes benefited white borrowers disproportionately” in the journal Nature. Photo by Matt Perko.
A national analysis of New Deal-era FHA and VA loans shows Black borrowers were systematically excluded during a pivotal expansion of U.S. homeownership.
A national analysis co-authored by UC Santa Barbara geographer Wenfei Xu shows that federal mortgage programs disproportionately excluded Black households during a pivotal era of U.S. homeownership expansion, contributing to racial wealth inequality that persists today.
From 1935 to 1947, Black Americans represented about 10% of the U.S. population and veteran population but received only 2% of Federal Housing Administration loans and 5% of Veterans Administration loans.
The study, published in Nature, digitized more than 100,000 mortgage records across 38 states and matched them with U.S. Census data. Wenfei Xu, an assistant professor in the Department of Geography, examines how housing policies, institutions and technologies shape urban inequality.
The findings provide the first national-level analysis of FHA and VA lending during this period and show how unequal access to homeownership created effects that could compound across generations.
“Any new housing policy should not only consider who it helps now, but what it sets in motion 50 years later,” Xu said.