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Despite growing Black homeownership in US, gap widens
In Massachusetts, the rates were lower across all demographic groups in 2022.
While homeownership rates increased among all demographics, between 2012 and 2022, the gap between Black American and other groups in the United States has grown, according to a new report from the National Association of Realtors.
The Black homeownership rate stood at 42.5% in 2012, compared with rates of 45.7%, 57.2%, and 69.2% among Hispanic, Asian, and white Americans, respectively, according to the trade group’s 2024 Snapshot of Race and Home Buying in America.
While homeownership rates ballooned by more than 5% among Asian and Hispanic people between 2012 and 2022, Black people haven’t seen the same increase.
In 2022, the group reports, homeownership rates stood at 44.1%, 51.1%, 63.3%, and 72.3% among Black, Hispanic, Asian, and white people, respectively, according to the report.
| HOMEOWNERSHIP RATE | BLACK AMERICANS | HISPANIC AMERICANS | ASIAN AMERICANS | WHITE AMERICANS |
|---|---|---|---|---|
| 2012 | 42.5% | 45.7% | 57.2% | 69.2% |
| 2022 | 44.1% | 51.1% | 63.3% | 72.3% |
| Percentage point increase 2012-22 | 1.6 | 5.4 | 6.1 | 3.1 |
In Massachusetts, the rates were lower across demographic groups in 2022:
| MASS. DEMOGRAPHIC GROUPS | HOMEOWNERSHIP RATE |
|---|---|
| Black | 38% |
| Hispanic | 33% |
| Asian | 58% |
| White | 69% |
Theresa Hatton, chief executive officer of the Massachusetts Association of Realtors, said more housing could boost inventory, making the market friendlier for first-time buyers.
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“There are a lot of factors in play with homeownership, especially for minority communities that didn’t come from a previous home where they built equity,” Hatton said. “So, a lot of times this is a first-home buyers’ situation, and first-time home buyers are very challenged in this market where we don’t have inventory.”
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The report also cites access to credit as an obstacle for home buyers of color.
The realtors reported that Black applicants were denied access to credit at a rate of 25% in 2022, compared with rates of 14%, 22%, and 14% for white, Hispanic, and Asian applicants, respectively.
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“While Black and Hispanic applicants face greater challenges in obtaining a loan, those who manage to secure one often encounter less favorable terms than white and Asian borrowers,” the report reads. “The data indicates that mortgages granted to Black and Hispanic borrowers frequently have higher mortgage rates.”
In 2022, a smaller share of Black and Hispanic renters (7%) could afford to buy a typical home in Massachusetts compared with Asian renters (21%), according to the report. High rental costs can keep prospective buyers from saving up for a down payment, Hatton said.
“If you’re spending more monthly on rent,” Hatton said, “you’re not able to put that extra couple hundred dollars away to save for the down payment, which I think is a big challenge for those trying to come into the housing market, especially competing with low inventory.”
More rentals and single-family homes, Hatton said, would help alleviate high costs. In Massachusetts, 38.2%, 34.1%, 27.7%, and 26% of Black, Hispanic, Asian, and White homeowners were spending more than 30% of their income on housing in 2022, according to the report.
Hatton said prospective buyers should talk to their financial advisers and mortgage brokers about programs that may provide down-payment assistance. They can also ask friends and family “what they would do different or what they absolutely enjoyed that was wonderful in the process,” Hatton said.
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“Talk to folks. There are programs out there that you may not even know about,” Hatton said. “So don’t think it’s out of reach … Don’t think you not having money is not a reason to talk to a financial adviser.”
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