As today is Juneteenth, we felt it was important to address a serious problem within the housing market that we as Real Estate Professionals must work hard to help change:
Disparity in homeownership rates based on race
Since the Fair Housing Act’s installation, the gap of homeownership between white residents and minorities, especially black residents, has been a glaring problem. Over the years, there have been some work done to help minimize this gap but it’s still significant. In fact, with the impact of COVID-19, the gap actually got wider!! Take a look at the most recent chart published by NAR in their 2022 Snapshot of Race and Home Buying in America report.
Although rates dropped significantly in 2020 & 2021, mortgages were still being denied - with Black prospective buyers having the highest denial rate when compared to other races. A large number of the denials were based on low credit scores, high income-debt ratios, and just not enough capital. The data also showed that Black homeowners invest the largest portion of their income towards homeownership.
As cited in the report:
“Thirty percent of Black homeowners spend more than 30% of their income on housing, representing nearly 2 million Black homeowners.”
**Compared to 21% for White Homeowners; 26% for Asian American, and 28% for Hispanic.
If interested, you can review the full report here.
So What Can Be Done About This Gap?
As real estate professionals, it is our job to help inform the general public and our clients about the ins and outs of purchasing a home. Sometimes, that means honest conversations about how credit works, why it’s needed, and budgeting techniques. It also means connected them to lenders who are well equipped to not only assist them in these areas but also help find them grants and programs to help alleviate some of the unbalanced financial burden. And it means working with local legislation to ensure Fair Housing programs and options are being utilized to their full potential.
It is up to all of us to help change the future. To walk forward towards true equality. To ensure that EVERYONE CAN OWN & LIVE IN A HOUSE THAT IS ALL THEIR OWN.
We are proud to have a team that is dedicated to helping EVERYONE find, purchase, and move into their home sweet home. If you’re struggling to find a home in PA or NJ, contact our team today!