U.S. housing still segregated: report

Tue Dec 9, 2008 8:54pm EST
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By Alister Bull

WASHINGTON (Reuters) - U.S. housing is still racially segregated 40 years after civil rights laws to end unfair practices, which also contributed to the subprime mortgage crisis, according to a report published on Tuesday.

The National Commission on Fair Housing and Equal Opportunity, which hopes to get a good hearing from President-elect Barack Obama, the first black U.S. president, also said a new agency was required to enforce laws passed by Congress in 1968 that too often have been ignored.

"When the rules break down in something as fundamental as where you can live ... our system doesn't work," said Henry Cisneros, a former secretary for housing and urban development under President Bill Clinton.

"I know the president-elect will see that as well," he said as he presented the report. Obama takes office on January 20.

The seven-member commission based its findings on hearings held in five U.S. cities between July and October.

"Past and ongoing discriminatory practices in the nation's housing and lending markets continue to produce levels of residential segregation that result in significant disparities between minority and nonminority households, (and) in access to good jobs," the report warned.

By denying minorities access to traditional home loans, discrimination also drove them into costlier subprime mortgages. When defaults on these loans began to climb in 2007, they hit the entire housing market, inflicting the United States with a recession and the highest unemployment level in 15 years.

"The subprime market discovered the African-American and Latino communities and targeted them," said commission member Okianer Dark, a law professor at historically black Howard University in Washington.   Continued...

<p>Row homes are seen in Escondido June 3, 2008. REUTERS/Mike Blake</p>