Black homeowners’ property values are on the rise across the country, with some of the biggest upswings in Midwestern and Southern states. The boon to Black homeowners, after decades of lagging property values, could help them close a racial wealth gap that has kept the American dream out of reach.

Home values increased on average 84% in majority-Black ZIP codes between 2016 and 2023, outpacing growth in white ZIP codes, where values grew 69%, according to a Stateline analysis of federal housing and census data.

A hot market during the COVID-19 pandemic, an intensifying housing shortage, and new state and federal efforts to fight appraisal bias may finally be moving Black homeowners a bit toward property value parity.

Morgan Williams, an attorney for the National Fair Housing Alliance, an advocacy group, cautioned that the push for more fair housing appraisals remains in the early stages. And he noted that even unbiased appraisals can perpetuate undervalued housing by using past sales as a benchmark.

“There was, during the pandemic, an increase in Black wealth. There may be some broad policy actions you could trace that to, but I think a lot of that is going to be more housing-market driven,” Williams said.

Recent research has revealed that homes in majority-Black areas are more likely than those in majority-white areas to be appraised below purchase offers. The disparity remains high but has improved recently, according to federal statistics.

The Stateline analysis found that the home price increases in majority-Black neighborhoods since 2016 are a major shift from the prior 15 years.

Between 2000 and 2016, selling prices in majority-Black communities increased by 40% compared with 48% for majority-white areas, and home values fell in more than a fifth of Black ZIP codes.

Since 2016, however, home values increased in every majority-Black ZIP code tracked by the independent Federal Housing Finance Agency, and on average outpaced increases in white ZIP codes.

Stateline relied on that Federal Housing Finance Agency data on ZIP codes, which uses sales of similar properties — so-called matched pairs — to estimate price changes over time. U.S. Census Bureau estimates were used to find ZIP codes where most homeowners are Black.

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