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Less than one in three Latino Bay Staters own their own home, the lowest level of any major racial ethnic group in Massachusetts in a new National Association of Realtors study. The figure makes the state third-worst in the nation for homeownership among Latinos.
Massachusetts’ Black-white homeownership gap was little better. According to NAR’s 2021 Snapshot of Race & Homebuying in America report, only 36 percent of Black residents own their own home, putting Massachusetts 28th among all states, plus Puerto Rico and Washington D.C.
Sixty-seven percent of White Massachusetts residents own their own home, NAR reported, while 56 percent of Asian Americans own their own home.
Nationally, 42 percent of Black Americans own their own home, 30 percent lower than the homeownership rate for white Americans and 18 percent lower than the rate for Latino and Asian Americans.
“This data reinforces the need to implement key policy initiatives NAR developed in concert with the Urban Institute and the National Association of Real Estate Brokers to address the Black homeownership gap,” NAR 2021 President Charlie Oppler, CEO of New Jersey-based Prominent Properties Sotheby’s International Realty, said in a statement. “Specifically, this five-point plan developed in 2019 calls on the nation to: advance policy solutions at the local level; tackle housing supply constraints and affordability; promote an equitable and accessible housing finance system; provide further outreach and counseling initiatives for renters and mortgage-ready millennials; and focus on sustainable homeownership and preservation initiatives.”
NAR also calculated how affordable homeownership was to the median family in each state by race. In Massachusetts, only 30 percent of Latinos and 31 percent of Blacks could afford a home, while 51 percent of whites and 58 percent of Asians could.
The report pointed to high debt-to-income ratios among Black and Latino households as the primary culprit.
Black households are more than twice as likely than white households to have student loan debt – 43 percent vs. 21 percent –with a median student loan debt for Black households of $40,000 compared to $30,000 for white households.
According to NAR’s 2021 Profile of Home Buyers and Sellers, which studied homebuying trends nation-wide, 10 percent of Black homebuyers and 6 percent of Latino homebuyers were denied mortgages compared to 4 percent of White and Asian applicants. In Massachusetts, 93 percent of Black homebuyers financed their home purchases, one of the highest rates in the country.
Less than a third of Black households can afford to purchase a home in California, Colorado, Hawaii, Massachusetts, Montana, Nevada, Oregon, Utah, Washington state, Wyoming and the District of Columbia, NAR found.
“The residential housing market’s strong performance during the pandemic helped homeowners enjoy a significant increase in wealth via approximately $1 trillion in additional home equity over the last year,” NAR Chief Economist Lawrence Yun said in a statement. “However, as indicative of the K-shaped economic recovery, greater numbers of potential first-time homebuyers – many of whom are minorities – are feeling discouraged by disproportionate job losses. Essentially, they’re being priced out of owning a home because of rapidly rising home prices resulting from historically-low housing inventory. For Black Americans, in general, the greater likelihood of having student loan debt, combined with lower household incomes and accrued savings when compared to the national average, adds to the challenge.”
