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Black Coalition for Housing to Host Black Developers Housing Summit

Black Developers Housing Summit

The Black Coalition for Housing will be hosting the 2023 Black Developers Housing Summit in Memphis on March 9-11 at the Hilton Hotel located at 939 Ridge Lake Boulevard. The theme for this year’s summit is “shifting the paradigm through equity and access.”

According to Tennessee managing director Rasheedah Jones, the Black Coalition for Housing is a national organization headquartered out of Chicago, Illinois.

Jones is a native “North Memphian” who wanted to bring this summit to her hometown after noticing inequities in the development industry. 

“Memphis was the first launch city for the outreach work, as a market that needed the kind of impact that we wanted to make across this country,” said Jones.

Jones has worked in the real estate industry in various capacities for 18 years. She said that her primary focus is on community development and rehabilitation around neighborhood development that supports affordable housing models. 

Memphis is the first-choice city for what is to be a five-city tour for the summit. According to Jones, there are challenges on the ground that continue to impact Black home ownership, and the inability to close the wealth gap.

According to information compiled from the U.S. Census Bureau, as of 2022, stacker.com said that the Black homeownership gap is 30.4 percent. The Black homeownership rate for Memphis is 58.8 percent, with the white homeownership rate being 74.3 percent.

“The disparity for homeownership continues to grow here,” said Jones. “Even with the deployment of dollars, even with the deployment of opportunities, what I have continued to hear is that there is a lack of skillset for Black developers to access opportunities.”

Jones also said that there is a large housing stock crisis, and that due to the dynamic market of interest rates, people are either falling out of the ability to obtain homeownership. She also said that people are unaware that they can enter into this as a wealth-building strategy.

“It was important for me to fight that Memphis be mapped in a way that those resources, opportunities, and conversations happen here,” said Jones.

In a statement released regarding the summit, it is stated that the purpose is to “synergize Black and minority developers at every stage of their real estate development, business journey by offering collective technical support, education, and the sharing of lived experience to scale, grow, and expose others to the next level.”

Jones said that the summit will consist of “foundations of development training.” She said that they receive inquiries about where to start in development. This is in hopes of exposing the foundation of development to developers who have zero to three years of experience, in addition to students who are looking to start work in development.

There will also be overarching conversations with “mixed levels of development.” There will be a panel of seasoned developers who Jones said have impacted their respective communities with onboarding properties, which she said were not “generating tax revenue up to the millions.”

Jones also said that these conversations will be heard by organizations such as the Black Legislative Caucus of Shelby County Commission, the City of Memphis Division of Housing and Community Development, and the Downtown Memphis Commission.

“We have a huge support system where we can lean into understanding as to what they’re looking for when they’re thinking of opportunities for Black developers,” said Jones. “The goal is to empower the participants, but to also list out the concerns and challenges that exist from both sides of the coin, so that we may be able to come together on some solution.”

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Memphis Faces ‘Very Real Housing Challenges’

Memphis is red hot and nobody probably knows that better than Paul Young, director of the city’s Division of Housing and Community Development.

From his office, he has a view of nearly every development underway here and of those that haven’t yet officially entered the development pipeline.

From that view, he said he sees opportunity here not seen in decades.

“We’re seeing an increased interest in Downtown and Midtown like we haven’t seen in 40 years,” Young said Tuesday during the inaugural Memphis Housing Summit. “It feels like every week there’s a new investor or developer that calls our office or reaches out to the mayor’s office to express development opportunities.”

Toby Sells

HCD director Paul Young answers questions during a news conference last year.

From that view, he also sees “some very real housing challenges” — new and old — vexing those trying to navigate it, especially low-income families and people.

During the Housing Summit, Young listed six of the major problems facing housing in the city. Here’s that list with some insight from Young.

1. The low cost of housing in our community

“In some sub-markets in the city, the average home value can be less than $50,000. The banks have limited products to fund homebuyer loans below this.
[pullquote-1] “Even if it’s a rental unit and if the unit needs considerable work, it makes it very difficult to cash flow when the average rents in the area are so low.”

2. Low wages

Young said housing finances are tough for those in federally identified low-income bracket (for a family of four that’s roughly $24,000; for a single person, that is $12,000). For them Section 8 housing vouchers are “a must.”

He said 8,000 in Memphis now use such vouchers. Another 8,000 are on the waiting list to get one. This all creates a supply-and-demand gap.

“We looked at the affordable rental supply gap from 2016, we had 38,000 households that met the definition of extremely low income,” Young said. “But we only had 13,000 units that were available for them at a price point.

”So, what happens to the other families that are missing those units? That’s what leads to overcrowding in housing and some of the issues that you see there.”

Low wages also means less income to support higher rents in Memphis. Low wages won’t cut it if Memphis home prices go up, Young said.

3. The high predominance of single-family homes that are being used as rental units

Frayser has led the city in home sale transactions, Young said. But an expert told him that 85 percent of those sales were from one investor to another.

“This means that homeowners and the nonprofit developers in our community are competing with investor capital, mostly from out of state,” Young said. “So, our single-family homes are becoming long-term rental units, which changes the character of neighborhoods that are developed for homeownership.”

4. Poor-quality, aging housing stock

Many houses here are in disrepair. Many of their owners or landlords are either unable to afford the repairs or are unwilling to do them.
[pullquote-2]
“The end result is that occupants in the units are impacted with poor indoor air quality — asthma, lead poisoning from paint chips, and other health-related issues,” Young said. “Given these quality issues in the units, the families become more transient, which has an impact on educational outcomes, job opportunities, and transportation.

5. The city’s large geography

The city of Memphis is currently 325 square miles. Boston is 91 square miles with 670,000 people, Young said.
Google Maps

City leaders annexed communities in decades past in an effort to increase tax coffers. City leaders now are trying to shrink that footprint with efforts to de-annex some of those areas to the tune of 15 or 20 square miles.

But the city’s large size puts a strain on transportation, which puts a strain on employment — getting to and from work.

The size also makes it hard, Young said, for developments in one part of town to spillover and pour developments in another.

6 Lack of quality middle-income housing alternatives in core, city neighborhoods

“Sometimes when people buy a house in some of the areas outside of the city, it’s not because they don’t want to be in the city is because they can’t find that product in a neighborhood that they would like to be in.

“Neighborhoods should be able to provide diverse housing types and options for families in all income brackets. They should enhance opportunities and access to jobs and services in close proximity to our homes.” 

The Citizen at McLean and Union

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‘Eviction Crisis’ Plagues Memphis’ Fast-Growing Rental Market

CREDIT: United Housing/Facebook

United Housing/Facebook

Memphis is the fastest-growing rental market in the country and the city faces an “eviction crisis,” according to experts at Tuesday’s inaugural State of Memphis Housing Summit.

It was a day of far-ranging discussions around housing that delved into topics like gentrification, redlining, the affordable housing gap, and the connection between housing and health. Speakers included government officials like Memphis Mayor Jim Strickland, Shelby County Mayor Lee Harris, and Paul Young, the city’s director of Housing and Community Development. But the summit also brought in real estate brokers, academics, lawyers, nonprofit leaders, and housing advocates from across the city and the country.

One discussion focused on the impacts absentee owners have on Memphis neighborhoods. In it, experts described a massive rental market here but one largely controlled by out-of-state, Wall-Street-backed investor groups that one speaker said ran their businesses here much like the mafia would.

Memphis was listed as the fastest-growing rental market in the country in a 2018 Zillow study, which found that 56 percent of single-family homes here were rented, not owned. It’s a massive statistic given more than three-quarters of the city’s housing stock is comprised of single-family homes. Investor groups and large corporations own 95,604 of those properties. Of those properties, more than 40 percent of their owners reside out of Tennessee.

With this boom in single-family rentals, has come a rising level of evictions from homes here. Austin Harrison, a researcher from Georgia State University and a housing consultant, told the Housing Summit crowd gathered at the Memphis Botanic Gardens Tuesday that the ”eviction crisis” here ”destabilizes families and communities.”

From 2016 to April 2019, 105,338 eviction notices were filed in Shelby County General Sessions Civil Court, according to Harrison. In 2016, 4,593 evictions were filed in New Orleans, 5,909 were filed in Birmingham, and 17,169 were filed in Richmond.

In that same year, 31,633 eviction notices were filed in Memphis. Notices here went out to nearly 21 percent of all Memphis renters. Renters who got eviction notices were predominantly African American, Harrison said.

Ben Sissman, a Memphis-based foreclosure prevention attorney, said most evictions here happen simply because the tenant does not make enough money to pay rent. But investor groups will use eviction or threat of eviction to squeeze money from tenants.

“These Wall Street guys — if you think of them in the same mindset as the mafiosos — they are predatory landlords,” Sissman said. “They’re selling high and doing no work. They deny responsibility for what they’re doing. All they want is the rent money and nothing else.”

Sissman described the strategy as “pump and dump.” Harrison called it “milking” the market.” They agreed, though, that the strategy is to buy homes in bulk for little, getting as much money for them as they can, and moving on.

“All these guys want to do is to maximize the short-term gain,” said Harrison. “They don’t inspect the properties. You’ll hear stories about mold, or the plumbing or the electricity not working. They don’t fix anything.”

United Housing/Facebook

But Harrison explained 90 percent of landlords are ”good actors.” The rest, though, are buying up large portions of housing stock and they’re doing it all over the country.

However, Nedra Reddit, a real estate broker in Memphis, said the city does “have a major problem” with absentee landlords here “but not as big as we’d like to sit around and discuss it.”

“I believe we’re just hiding behind ’we don’t know who they are,’” Reddit said. “We know who they are. I represent the National Association of Real Estate Brokers. Cheryl Muhammad is our president. Call her if you want to know what to do with an absentee landlord.

“We have in place a way to locate everybody and we’d like to let Memphis know we are here as the central point of contact for any housing need, whether someone isn’t paying their mortgage and they’re about to lose (their home) or they can’t get their landlord to fix the water heater.”