How Church Sales Reflect the Shifting American Demographic

Say goodbye to your corner church and namaste to the mandir—sales of houses of worship are a window to America’s changing population.
Sergey Galyonkin/Flickr

In early June, I visited my hometown of Glendale Heights, about 25 miles west of Chicago. Making my way through the old avenues that had marked my childhood, I noticed something curious: The churches that had dominated the street corners of my suburban youth—from magnificent stone structures with ornate stained glass windows to homey, unmarked brick buildings—were either getting demolished or being sold to become Hindu temples.

As strange as it may be to see "Gayatri Gyan Mandir" on the outside of a building that could be next to the dictionary entry for "church," it's part of a larger story of the changing demographics of American society. It’s not just in Chicago, and it’s not a unidirectional trend. Synagogues are becoming mosques, Baptists are changing hands with Korean congregations, pagodas are moving into office buildings.

The handover in houses of worship across the country is not a straightforward case of an increase in non-Christian immigrants in the United States. In fact, many church sales can be attributed to shifts among Christian denominations. Roman Catholic weekly service attendance has slid from 75 percent in 1955 to 45 percent in the mid-2000s, while Southern Baptist and Evangelical churches have seen big drops in attendance, partially due to a split within the Protestant church between mainline Protestantism and Evangelicals. Meanwhile, Pentecostal churches have seen spikes in attendance.

Much of this shift can be attributed to a growing Latino population. Historically Roman Catholic, nearly one in three Latinos today identify as former Catholics. Ex-Catholics tend to veer in one of two directions: they either become Pentecostals or Evangelical Protestants, or they identify themselves as agnostic or atheist. According to Pew Research Center’s 2013 National Survey of Latinos and Religion, only 40 percent of Hispanic Catholics attend weekly services; comparatively, 71 percent of Hispanic Evangelical Protestants do so.

Beyond the Christian faith, immigration is shaping the religious landscape of America and influencing the church purchasing process. A recent map from the Association of Statisticians of American Religious Bodies of the second most popular religions in states across the country showed that Islam, Judaism, and Buddhism were represented strongly across the country. Though Christianity remains the overwhelmingly dominant religion of choice in the U.S., other faiths are quickly growing, such as Hinduism in Arizona and Delaware and the Baha'i faith in South Carolina.

Mary Raphael, co-owner along with her husband Dave of Raphael Realty, knows this. Their southern California realty firm has dealt solely with sales of religious properties for 35 years.

Raphael traces the most recent upswing in church sales to the burst of the housing bubble in 2008. While parishioners were struggling with making mortgage payments and impending foreclosures, churches too dipped into their reserves to pay off refinanced properties. But this method sometimes backfired.

“So many people were losing their jobs and churches can’t continue for years on their reserves,” Raphael said. “Tithings to churches had declined so much for such a long period that a number of churches used up reserves and refinanced properties. We had foreclosures on churches.” Raphael's observation matches statistics: Giving USA released a recent report noting that donations to smaller churches had fallen by 10 percent during the past year and hadn't yet recovered from pre-recession era donation rates.

What made finances more complicated for churches is that banks often don’t like to be associated with lending to religious institutions, fearing it might isolate their consumer base who might not agree with being associated with a religious organization views, says Raphael.

“It makes it very difficult,” Raphael said of the banking process for churches. “It’s hard to document income for churches since they keep their own records and [finances] must be verified by an outsider. Lenders avoid [churches] since it’s bad PR.”

This puts churches in a bind: They can’t maintain their properties, and despite wanting to stay open—sometimes very desperately—they end up stumbling into foreclosure. Churches have the added obstacle of legally being nonprofits and requiring a very different legal system than businesses or individuals buying and selling property.

In the Raphaels' home base of California, for example, “You have to verify with the Secretary of State in southern California that the church is capable of holding a title, is a legal entity, and is incorporated as a nonprofit. Otherwise, you can’t get a title insurance, and you can’t do the transaction by the laws and articles of incorporation. Then you have to adopt a resolution.”

And finances are a difficult subject for churches, too, as many rely on tithings, fundraising, and private donations to keep their places of worship afloat. Money becomes even more of an hurdle for religious organizations seeking to either start anew or re-establish themselves in a brand new space. “Some of these groups have their own financials,” Raphael said. “Some are ready with a 30 to 40 percent down payment, but it’s hard for groups to have that in cash. Different religious groups also have credit unions.”

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Tanya Basu is an editorial fellow with The Atlantic.

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