GRAND FORKS — When Bishop Michael Cole, a Black man, was denied a loan to buy the land on which his church now sits, it wasn’t the first time he had encountered trouble buying property in Grand Forks.
Cole, of Gospel Outreach Ministries Church in Grand Forks, made headlines in the 1980s, when he first established his parish downtown. The City Council denied him permission to occupy the church multiple times over a 10-month period. He was ultimately allowed to establish the church, but he believes the difficulty he faced was discriminatory.
The experience took him by surprise.
“I love Grand Forks, and I love the people, and I love people of all backgrounds and nationalities,” he said. “That’s because, the way I was raised properly, is that I never knew that that would be a challenge in this particular territory.”
A little over 12 years ago, Cole and members of the church bought the land to build a larger church on 42nd Street South. He encountered challenges again — this time, he could not find a local bank willing to loan him the $1.3 million needed to buy the land. Lenders said his congregation was too small, Cole recalled.
Eventually, a friend recommended Cole go through his bank in Albertville, Minnesota, outside of Minneapolis, and he successfully secured the loan. When he returned to his North Dakota bank to make the purchase, the banker wanted to know where he had gotten the money.
“I thought that was rude,” Cole said. “You’re not going to loan me, but you want to know, ‘How’d you get your money? Where did you get the money from? Who loaned it to you?’ ”
“At that particular time,” he continued, “I realized what we dealt with a little bit. I still didn’t have any aggression to our city. I love this city. And I realized they were ignorant. They just didn’t know, and I didn’t take it as an offense.”
Unlike his dispute with the City Council decades prior, he demurred from calling his experience with the banks racial discrimination.
“Sometimes it’s a tough thing. I’m not an easy person to trigger with discrimination, because I was trained pretty well by my grandparents,” he said. “I’m just careful. Because I’m in the city now, a lot of my Caucasian friends felt that it was a lot of discrimination, but I just counted it as, you know, let me prove who I am, not just by the color of my skin but by the integrity of my abilities.”
Still, it’s an example of one thing people of color in the region must be ready to navigate when they’re buying property, he believes.
In recent years, both North Dakota and Minnesota have reported some of the nation’s worst racial disparities in homeownership, according to America’s Health Rankings.
In North Dakota, those disparities appear to be improving — 15.1% of Black households own their homes, compared to 67.1% of white households, according to data provided by High Plains Fair Housing, a housing nonprofit in Grand Forks. In 2021, according to America’s Health Rankings — the data used by High Plains — North Dakota ranked 50th in the nation, with a gap between Black and white homeownership of 52 percentage points. The following year, that gap narrowed to 31.6 points, and North Dakota jumped in the rankings to No. 19.
In that same time frame, Minnesota saw little movement in its numbers — in 2021, its gap between Black and white homeownership was 47 points, and the next year that number rose to 48. As of 2022, the most recent data available, it is No. 49 in the nation, only ahead of Maine.
An annual housing report by the Minnesota Housing Partnership issued last month found that in a state already lagging in equitable homeownership, northwest Minnesota reports the largest gap in the state. In that region, only 10% of Black residents own their homes, compared to 78% of white residents who are homeowners, according to the report.
Overall in the U.S., 44% of Black households and 73.3% of white households own their homes, and the racial homeownership gap is 29 points. According to High Plains Fair Housing, in Grand Forks, that number — between 2016 and 2020 — was 46 points, and in East Grand Forks in the same time frame, 76.
Anne Mavity, director of MHP, said there remain homeownership disparities in every racial group in Minnesota, but the homeownership rates among Black residents — particularly in the northwest part of the state — are the most startling.
“It took generations to come to these kinds of unacceptable outcomes,” she said. “And so I don’t think there’s one program that’s going to solve all of that.”
Historically, exclusionary policies over decades inhibited the ability of many people of color to build wealth — that can continue to impact young would-be homebuyers as, for example, some parents and grandparents are unable to help with down payments.
There are other structural challenges, Mavity said. Particularly after World War I, as the U.S. government built new housing for returning veterans, people of color were excluded from those opportunities by exclusionary financing and exclusionary zoning. Federal maps were also drawn that did not provide funding and financing in areas where households of color lived.
In many ways, those maps persist today, she said.
“Housing is sticky,” she said. “People live in a community, and it’s their neighborhood. They want to stay there for generations, right? Where you grow up and go to the same schools, and have your job and your friends and your church and your faith communities. And so those disparities persist.”
The most significant barrier to homeownership right now, according to Jade Eagle, a High Plains housing specialist, is still the tight housing market, an issue faced by buyers across the board. But paired with the nationwide housing shortage and high mortgage rates, those historic barriers faced by people of color are often enough to shut many would-be homebuyers out of the market, she said.
Last year, High Plains Fair Housing convened a statewide group to study racial gaps in homeownership. The group compiled a list of seven recommendations to address the disparities:
- Provide education and advocacy for fair practices in homebuying
- Increase public awareness of programs that assist first-time homebuyers and that make homes more affordable
- Promote real estate sales and appraisal as a career option to students of color to increase diversity in these professions
- Develop strategies to educate real estate professionals on alternative financing options for non-traditional buyers
- Translate real estate and mortgage lending materials into different languages
- Advocate for zoning changes that are friendly to increasing residential development
- Encourage local governments to provide incentives for contractors to build more housing in general, as well as for middle- and lower-income families
There’s also work being done on the Minnesota side of the border. For example, in 2023, the Legislature passed robust down payment assistance and first-time homebuyer programs to help remove economic barriers that prevent people from becoming first-time homeowners. Those programs are now active and available to qualifying homebuyers.
There are also cities and counties across the state that have established local housing trust funds to help target local needs and resources to address housing challenges. There are no such funds yet in northwest Minnesota, although the city of Crookston
appears poised to establish the first
. Minnesota Housing Partnership has established a matching fund to help bolster those local trust funds, and has begun providing toolkits and other resources to communities that hope to establish their own funds.
Those efforts have not yet impacted the state’s overall data, but MHP is tracking positive movement in the numbers in some areas. The bottom line, Mavity said, is that there is still work to be done.
It’s not clear why northwest Minnesota lags so significantly in Black homeownership, Mavity said, although she suggested the overall diversity of a population might have something to do with it. She said it seems homeownership gaps are narrower in areas of the state that are more diverse. Perhaps the theory that homeownership disparities are tied to overall diversity could help explain the dramatic jump in the numbers in North Dakota — U.S. Census data shows that North Dakota has the fastest-growing Black population in the U.S.
Between the 2010 and 2020 census, North Dakota’s Black population increased 211.2%, an increase of 23,413 people. Black residents made up 1.6% of the total population in 2010 and 4.4% in 2020.
In terms of fastest-growing Black populations, South Dakota takes a distant second in the rankings with a 78.9% increase, or an increase of 11,602 people. Minnesota ranks No. 10 with a 47.7% increase, or 156,098 people.
Cole has personally noticed this trend just in the last few years. He said that as more Black people take up residence in Grand Forks, they tell their friends and family in other states about the city, and soon their loved ones tend to follow. Purely anecdotally, he said he’s noticed the largest influx of new Black residents coming to Grand Forks from Chicago.
The way he sees it, of course there have been challenges for Black residents and other people of color who hope to buy homes in the area. Still, he said, as the city becomes more of a “melting pot,” in his words, he hopes an era of discriminatory housing practices is on its way out.
“Yes, there is discrimination,” Cole said. “I’ve had people tell me there is discrimination, and stuff like that. But basically, once we look at the system, and we see how to overcome it, then a lot of the people did get their loans, and did get their houses.”
A 2022 Federal Reserve Bank of Minneapolis report found that Black mortgage loan applicants are 2.9 percentage points more likely to have their applications denied than white applicants. A follow-up analysis of confidential Home Mortgage Disclosure Act data in 2024 found that lender-reported reasons for mortgage denials don’t fully explain the racial disparities.
Still, Cole said, many have learned to approach buying property with an attitude of persistence — unlike in the 1970s and ’80s, he noted now, prospective homebuyers can go online to seek loans from banks outside of their cities.
“In our communities, we tell people to fight,” he said. “Have you got a good credit score? What’s the problem here? Let’s get this up. And that way, especially if it’s something that’s tied to federal loans, there’s no way you can be denied.”
Eric Hylden/Grand Forks Herald
