Home ownership is the most powerful tool for closing the racial and ethnic wealth gap. To underscore this point, Latino homeowners have 28 times the wealth of Latino renters and a median net worth of $171,900 versus $6,200. The wealth gap between Latino families and their non-Hispanic white counterparts narrows significantly when comparing the household wealth of Latino homeowners to that of non-Hispanic white homeowners, highlighting the power of homeownership to bridge the gap. racial and ethnic wealth gap.
Latinos are aging in their prime home buying years and are expected to account for 70% of homeownership growth over the next 20 years. The demand for housing among communities of color is there; however, the severe housing shortage threatens not only the reduction of the ethnic and racial wealth gap, but also the future economic growth of our country.
In terms of homeownership more broadly, history suggests that real estate activity has helped sustain economic growth after past recessions, and according to the National Association of Home Builders (NAHB), housing accounts for 16 .3% of US GDP. High home ownership rates are a goal worth fighting for.
According to findings from the National Association of Hispanic Real Estate Professionals (NAHREP) and Up for Growth, here are the realities for Latinos:
- Almost all Latinos live in metros experiencing housing underproduction.
- Latinos live in states with the highest rates of underproduction.
- Latinos are concentrated in metropolitan and micropolitan areas (MSAs) with the highest rates of underproduction.
- Underproduction is worsening in all major Latin markets.
- There are very few Latinos in the markets that have sufficient housing supply.
So how can we gain traction on housing? Priority #1 is to tackle the national housing stock and affordability crisis by building more homes. Expanding access to credit and fostering an enabling lending environment for the growing share of Latino homeowners is also critical. Additionally, we need to ensure first-time home buyers have access to competitive financing while empowering the real estate industry, policymakers and future homeowners with tools and resources that help increase homeownership. homeownership among Hispanics. NAHREP’s free resources include a bilingual glossary of industry terms, a tool that tracks congressional district rankings based on Hispanic homeownership rates, and other publications that highlight homeownership trends. Homeownership and Wealth of Hispanics.
Finally, championing immigration reform will help solve the labor shortage and stimulate our economy. NAHB reported the correlation between high immigration rates and increased construction. In fact, 56,000 immigrants entered the construction labor market in 2018, a drastic drop from the 130,000 who entered in 2005.
More investment in housing is needed more than ever to unlock the growth potential of homeownership inherent in our demographic dynamism.
For more information, visit https://nahrep.org/.