During the COVID-19 pandemic, many Americans are wondering how to survive and eventually thrive financially. This is especially important for Black Americans, who have the lowest rate of homeownership in America and whose businesses are struggling.
Most Black Americans rent their homes, apartments, and the buildings housing their businesses. During an economic crisis, landlords start evictions, worsening the problem. As a result, the idea of “buying the block” - increasing Black ownership of homes and businesses in Black neighborhoods - has recently gained steam.
The effects of COVID-19 have brought new attention to the impact of America’s long legacy of housing discrimination. Is “buying the block” the solution?
When Jay-Z encouraged Black entrepreneurs to “buy the neighborhood” on his 2017 hit record “The Story of O.J.,” it was not a new idea.
Lynn P. Smith founded Buy The Block, an investment crowdsourcing platform, in 2013. It intends to connect investors to each other, so they can pool resources to purchase real estate - an investment typically only available to the very wealthy.
The movement is growing rapidly, and could be a major way cities transform as a result of the pandemic.
One of those crowdfunded investments was in Houston, where local investor Chris Senegal recognized the impacts of gentrification: “When the community feels neglected, people come in and they don't have an affiliation with the neighbors," he told the Houston Chronicle. "You need to give more of a sense of revitalization to the neighborhood."
He also sees community investment as a response to the pandemic. "We would like to do mixed-use development, including a coffee shop, insurance office, and doctor's office … The communities need more health resources ... When COVID-19 hit, they got hit the worst."
Similar efforts are taking off around the country.
In South Los Angeles, Daniel Carter started a group called Buy Back The Block L.A., which brings together interested Black investors to work together on real estate deals in Black neighborhoods.
They also share information about homeownership and general financial knowledge. “I don’t know if I would be so much in the know of how and what’s going on [in real estate] ... if I didn’t have the education and the things that I’ve learned from the group,” Arlen Escarpeta, a group member, told Curbed.
While activism in terms of “buying Black” has surged recently as a form of support for Black-owned businesses hard-hit by the pandemic, many analysts believe it’s not enough - or will soon fade as public interest fades. They believe that the real answer is investment.
“Black and Latino entrepreneurs receive only 1% of startup funding and many Black business owners didn’t initially qualify or receive government assistance during the pandemic,” notes Bloomberg. In order to survive long-term, “businesses will need buy-in from a number of stakeholders: Consumers, investors, vendors and others.”
Black investors who see ownership as the path forward hope they have the key to lasting change for Black American homeowners, renters, and entrepreneurs.