While the national homeownership rate decreases, ownership rates among Hispanics are defying the trend with steady rises.
The Hispanic homeownership rate grew to 46 percent last year, topping previous highs of 45.6 percent in 2015 and 45.4 percent in 2014, according to the National Association of Hispanic Real Estate Professionals’ 2016 State of Hispanic Homeownership Report.
More than 7.3 million Hispanic households owned their homes in 2016, 330,000 of which were from new households formed in 2016. That comprises 38 percent of all households formed, according to the report.
“The significance of a strong desire for homeownership cannot be overstated,” the report notes.
The majority of Hispanics surveyed say they view homeownership as a wealth-building vehicle and vital for families with children.
But financing continues to be a big challenge. Hispanics were denied mortgages in 2016 at a rate of 17.3 percent, about 9 percentage points higher than non-Hispanic whites.
“While the Hispanic market has outgrown the ‘niche’ segment designation, the housing industry is just beginning to fully recognize its significance to the vitality of the overall market and is responding with products and services that are more relevant to the needs of Hispanic consumers,” according to the report. The report notes recent such initiatives at Bank of America, Fannie Mae, Freddie Mac, and Wells Fargo.
Hispanics represent a major opportunity to garner new business for real estate professionals, but their unique needs must be accounted for, the report notes.
“Hispanics tend to reside in a multigenerational household of a typical nuclear family and include additional family members like grandparents or other adult relatives, all of whom contribute to household expenses,” according to the report. “These influencing factors are interconnected with their culture and affect how they bank … Access to culturally competent real estate and mortgage professionals who speak Spanish and can recommend appropriate solutions to meet their needs creates a level playing field.”
Source: “Hispanic Homeownership Rate Rises for Second Straight Year,” RISMedia (March 28, 2017)