There has been much speculation and unrest over the state of the housing market in the past year. However, there is one thing that is certain: Hispanics are increasingly crucial to the health and wellbeing of the U.S. housing market.
A force to be reckoned with
Hispanics are currently the country’s largest ethnic minority and have accounted for more than half of U.S. population growth, as well as81 percent of U.S. labor force growth since 2000.Moreover, Hispanic household growth has consistently outpaced that of overall U.S. household growth in the last decade. A majority of all U.S. Hispanics are 35 or younger, and many are in or entering their prime home-buying years. Put simply, this is a “mega market” that can’t be ignored.
Suprassing other groups
Homeownership rates for Hispanics have experienced significant growth in the last 10 years. Increasingly, Hispanics understand that homeownership is a pathway to wealth and they are investing accordingly.
According to the U.S. Census Bureau, while Hispanics make up 18 percent of the U.S. population, they have accounted for nearly 63 percent of new U.S. homeowner gains over the past decade. Latinos are the only U.S. demographic to have increased their homeownership rate each year for the past four consecutive years.
Hispanics are motivated to own homes
Hispanic attitudes toward homeownership are extremely positive. In a 2018 Fannie Mae survey, 88 percent of Hispanics agreed that owning a home is the best investment plan, and that they are better off owning as opposed to renting. There are other practical factors that make homeownership attractive for Hispanics. For example, Hispanics are more culturally inclined to live in multigenerational households, which often necessitates a larger living space.
Current data suggests that Hispanics will continue to drive homeownership gains in the United States for the foreseeable future. For that reason, it is increasingly important to recognize and address the nuances and unique needs of the Hispanic home buyer. These needs include supporting national and local policies that will stimulate the building of affordable housing, and expanding access to affordable home loan financing. Lenders and real estate professionals can better serve the needs of this market by providing Spanish language staff and materials and offering information and access to down payment assistance programs.
Catering to the needs of the Hispanic homebuyer is a business imperative in today’s real estate market. It is in all of our best interests to promote sustainable homeownership within the Hispanic community.
David Acosta, President, NAHREP, [email protected]