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The Value Gap: ‘You shouldn’t just let them go without a fight’: Why the U.S. can’t lose its Black middle-class neighborhoods

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The Value Gap is a MarketWatch Q&A series with business leaders, academics, policymakers and activists on reducing racial and social inequalities.

The Black neighborhoods of older American cities — where people like Michelle Obama grew up, generations of Black families achieved middle-class homeownership, and small local businesses thrived — are in trouble, says Alan Mallach.

Mallach is a lion in the world of inclusive, progressive housing and urban development issues. He has been a writer and researcher, perhaps best known for his book “The Divided City: Poverty and Prosperity in Urban America,” as well as a practitioner, serving as director of housing and economic development for the city of Trenton, N.J., among other things.

In February, Mallach published a working paper titled “Making the Comeback: Reversing the Downward Trajectory of African American Middle Neighborhoods in Legacy Cities,” which documents in detail the challenges of “Black middle neighborhoods” in six cities, and suggests strategies for stabilizing and reviving them.

“When you have these spaces and they have provided value for generations of families, you shouldn’t just let them go without a fight,” he said in an extended interview in July.

Mallach, who is currently a senior fellow at the Center for Community Progress and a visiting assistant professor at the Graduate Center on Planning and the Environment at Pratt Institute, spoke with MarketWatch about the paper’s big ideas, and what they may mean in practice.

The interview has been edited for length and clarity:

MarketWatch: Alan, would you mind defining, in your words, “Black middle neighborhoods,” and tell us why you thought it was important to take a look at them in such deep detail now?

Mallach: A middle neighborhood is basically a middle-class, working-class neighborhood — the kind that if you go back 60, 70 years, most Americans lived in, before we started to separate and become more rich and more poor.

But it’s still a very important part of America’s cities, near suburbs, and so forth. Probably anything from 30% to 40% of Americans live in what are basically middle neighborhoods, a lot of them in cities like Chicago, Detroit, St. Louis, Philadelphia, you name it.

Black middle neighborhoods, by definition, are middle neighborhoods which are predominantly African American. For the [working paper], I set a cutoff point of 80% or more Black. And what’s important about Black middle neighborhoods, or middle neighborhoods in general, is they are still in many respects the backbone of cities. This is where the city’s middle class lives, this is where people move up to for greater opportunity, this is where the civic and political leadership of the city lives, this is where it all develops.

They have been the backbone of Black communities in the United States — certainly since the ’60s and ’70s, when most of them came into being. I don’t know if you’ve read Michelle Obama’s autobiography, but this is the kind of neighborhood she grew up in in Chicago, the South Shore. 

And what’s happening — and this is why I have been studying this and wrote the paper — is they are in trouble. They are seriously in trouble. In the last roughly 20 years, they’ve been losing ground steadily.  Either we focus on preserving these neighborhoods — and there are a lot of people doing that, but not enough — or these may be the poverty neighborhoods, the disinvested neighborhoods, of the next generation.

In some cities like Detroit, I hate to say it, but I think a lot of neighborhoods that were solid middle class 20 years ago are no longer, and are seeing large-scale abandonment and poverty and all the other ills that come with that. I think that if we’re going to save these neighborhoods, we have to focus on them, we have to understand what’s going on, and we have to come up with strategies that make sense.


‘There are a lot of people for whom being in what you might call a safe Black space really matters.’

MarketWatch: Do you mind talking about why you look at what’s happening now and not just see that as part of a cycle — that American life is transforming, the way we live is changing?

Mallach: I think it’s certainly tempting to look at that. But first, I think you have the question of, are these places disposable? Should we be thinking, especially in an age when we’re at least supposedly more conscious of the environment, energy and so on, should we be thinking of neighborhoods, houses, parks, streets, schools and so forth, as being disposable? You know, “Been there, done that, let’s move on,” let’s move another 10, 15, 20, 30 miles out into the countryside? Or should we start looking very differently at neighborhoods and say, if we have a neighborhood that is basically sound, we should work to try and preserve that?

The second issue, I think, goes to the nature of race in this country. And this certainly came up consistently with people I talked to. When the immigrants — like my parents — moved out of immigrant neighborhoods and kind of “mainstreamed,” you might say they became white.

Black people don’t have that option. One of the most powerful books you can read about that, that really brings this home, is Isabel Wilkerson’s book “Caste.” And a lot of the people, especially Black people who are leading the efforts to preserve these neighborhoods, there are a lot of people for whom being in what you might call a safe Black space really matters. And when you have these spaces and they have provided value for generations of families, you shouldn’t just let them go without a fight. They’re important. 

Just one other thing: A lot of these neighborhoods are in cities like Philadelphia and Chicago, that in many cases are becoming increasingly polarized. You have upscale neighborhoods full of well-to-do people and up-and-coming young techies. You have desperately poor neighborhoods that are falling apart. Not that much in between. In many cities, this is what’s in between. And if this goes, I think that’s going to be devastating to the future of a lot of these cities. 

MarketWatch: I actually have a question about gentrification. You wrote about how many homeowners in Black middle neighborhoods are likely to have a hard time finding a buyer when they go to sell. This is striking because there is this other concept of gentrification, young people, white people, gay people, coming into neighborhoods that were traditionally considered Black. It’s sort of a yin and yang, right?

Mallach: That is one of the biggest misconceptions about what’s happening in American cities. By and large, Black neighborhoods are not gentrified. The most common neighborhoods to gentrify are white working-class. … Consistently, gentrification follows race, not in terms of singling out Black neighborhoods, but in terms of avoiding them.

There are some cities where Black neighborhoods have gentrified, and some of them are extremely high-visibility, like New York, where the neighborhoods closest to upscale Brooklyn were Black, and Harlem was just waiting, just north of the upscale west and east sides. If you look at the national picture, those are very rare exceptions. I looked at the entire pool of Black middle neighborhoods, over 300 different Census tracts from the cities I studied, hardly any of them gentrified. 

Read next: Four years, $13 million and dozens of hands: How ‘affordable housing’ gets made in America

MarketWatch: Fair enough. Sticking with the home-buying process, you wrote about how Black home buyers are, more recently, much less likely to buy in Black middle neighborhoods: “To revive urban Black middle neighborhoods, one must restore their competitive edge vis a vis their suburban or racially mixed counterparts.” Do you mind talking a little bit about what that competitive edge looks like, and is that necessarily a local initiative to restore it?

Mallach: Basically, homebuyers, especially young families, especially young families with children, who have historically been the backbone of these neighborhoods, are very pragmatic people.

Many of them have ideological values and so forth, but when it comes right down to it, when they’re going to make a decision on where to buy a house — and for most working-class, middle-class families, this is far and away the most important financial decision or decisions they ever make — they’re going to go with very pragmatic values: schools, safety, general sort of quality-of-life measures, “Is my house likely to appreciate?” There are people who would argue that shouldn’t be relevant. But it is. It’s baked in at this point, I think, to people’s decisions. 

So they look at these factors. And unfortunately what’s happened in a lot of these Black middle neighborhoods is that they don’t measure up to other places on one or more of these indicators. The schools may be questionable. The schools may be good but the safety may be questionable. And sometimes, unfortunately, people may perceive a neighborhood as being less safe than it is, but perception matters.

And this becomes kind of a vicious cycle: The fewer people buy in a neighborhood, the less house prices appreciate. And so what’s happened, and the not-enough buyers are a big part of the picture, house values in a lot of these neighborhoods have been very flat.

And another part of it is, if you look at most parts of the U.S., not necessarily the New York area, but almost any metro in the United States, a family earning a modest middle-class income, like say $50,000 to $60,000 a year, can find a fair amount of choice in suburbs where they can buy a single-family house and get at least marginally better, or what they think is better, conditions, whether it’s safety, schools, future appreciation, parks or whatever. It’s really nuts-and-bolts stuff.


‘These neighborhoods can be saved for a lot less money than it would take to bring them back if we let them go.’

MarketWatch: So to stop that vicious cycle you talk about, you write in the paper about some local initiatives, but I’d also like to ask you about a new administration in Washington, particularly since so much of this legacy comes down to the aftermath of the subprime bubble and bust. What should a new administration be thinking about? Community Reinvestment Act issues, FHA/FHFA? I know you feel very strongly about eviction policy, so however you’d like to answer that. 

Mallach: Eviction policy is a huge issue, but not in this context. I don’t think it’s a housing subsidy as such that’s needed. House prices are low enough that anybody who’s a remotely decent candidate for a mortgage can make the payments. First thing is we need better capital access. One of the things that’s almost notorious, banks don’t like to make small mortgages. Banks don’t like to make mortgages to people who don’t have pretty decent credit ratings.

I’m not suggesting for a second that we go back to the Wild West days of ’04 and ’05 when anything that could breathe could get a mortgage for any amount, but I think we need better access for more people to be able to buy houses that have low sales prices, as well as to be able to get the money to fix up the house, put in the second bath, whatever. For people who have relatively low incomes and maybe not great but not terrible credit ratings.

Cities need more help — not just financial help generally, which is always nice, but really targeted help to improve the quality of safety and quality of schools in these neighborhoods. Everybody’s talking about the whole issue of policing, and that’s a huge issue in these neighborhoods, and coming up with ways to really improve policing and safety, ways that people can be confident that their kid’s going to get a decent education. I think we really have to focus on that, and certainly federal money, carefully targeted, could make a huge difference. 

One thing I would love to see is in neighborhoods which have really strong organizations that are capable of doing this, is programs where they can really come in when a house comes on the market and make it move-in-ready. … I certainly have heard a lot about how a lot of people don’t buy in these neighborhoods, because typically a house comes on the market, let’s say a family lived in the house for 50 years, and the last 20 years they were elderly on a fixed income. That house needs work. A young couple with kids, they don’t want to spend the next five years living in a construction project. … Something like that could be a game-changer.

Another thing that would help … this is, again, a bit of a guess … is the effect of the pandemic on the shopping centers and small stores in these neighborhoods. It’s been very drastic. I think programs to help build up neighborhood shopping in these areas. These are not big-picture, dramatic things, and a lot of them have to be sort of pulled together. This is another thing about these neighborhoods: We’re not talking about having to go in there and spend hundreds of millions of dollars for massive renewal, redevelopment-type projects. These neighborhoods can be saved for a lot less money than it would take to bring them back if we let them go.

MarketWatch: Very well said. There’s a lot in the paper that we could talk about, but one thing you didn’t talk about that’s having a bit of a moment right now is the idea of highways and transportation systems having cut through Black neighborhoods, and whether that tends to have a racist legacy. I wondered if the fact that you didn’t talk about that issue is just because they predated the periods in which these neighborhoods thrived, so they thrived in spite of that infrastructure.

Mallach: Go back in history. Put yourself in an American city in the 1950s. At that point, the vast majority of Black people in cities, whether they were rich, poor, middle-class, lived in segregated — you could call them ghettos because they were basically segregated, there was no fair housing law, there were racial covenants, etc., people couldn’t find housing outside there, they couldn’t move into the Levittowns.

What happened during the ’60s and ’70s was totally transformative in those cities. Those were the neighborhoods that most often highways cut through and urban renewal devastated. Not all of them, but a lot of them. What happened is that starting in the ’50s and ’60s, millions of white people fled the cities.

That represented an incredible opportunity, and that’s when most of these Black middle neighborhoods emerged. Large numbers of Black people living in these … neighborhoods, who had decent earnings, who because there were very few home-buying opportunities in these neighborhoods, a lot of them had accumulated a lot of savings, and they were eager to become homeowners. 

Now here were all these white people leaving these neighborhoods, these nice middle-class neighborhoods in other parts of the city. That’s where the middle-class and working-class people with steady incomes who could become homeowners, moved. They went in, they bought those homes, and they stabilized those neighborhoods and made them the Black middle neighborhoods.

So what I’m talking about in the report aren’t the neighborhoods that were cut through by highways and devastated by urban renewal. Those neighborhoods in some cases are gone completely. For example, Black Bottom in Detroit was where the great majority of Detroit’s Black people lived up to the 1950s. Between the Chrysler freeway that came down here and the urban renewal over here, it just disappeared from the face of the map. In New Orleans, the Tremé neighborhood is still there. It’s got a highway running through it, which certainly doesn’t do it any good, but the neighborhood is still there otherwise. So there’s a mixed bag.

‘In New Orleans, the Tremé neighborhood is still there,’ Mallach says.

Getty Images

The neighborhoods that became the Black middle neighborhoods were not those areas. And a lot of them are in sort of more outlying parts, parts of the city that were developed in the ’20s and ’30s and sometimes even in the ’50s and ’60s, and they’re not the ones that got clobbered. 

MarketWatch: It’s a great story of evolution and how cities evolve.

Mallach: It is, and it’s a story that a lot of people don’t know. There’s this sort of assumption, this narrative that we have, that when the whites left in the ’50s and ’60s and ’70s, the cities just fell apart. It certainly hurt the cities. But the fact that Black families moved into these neighborhoods and stabilized them and turned them into neighborhoods that would be healthy, vital places for the next couple of generations — that’s not a story that hardly anybody knows.

MarketWatch: And it goes back to your earlier point about why it’s worth saving.

Mallach: Exactly.

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