In Texas, Asians, Latinos lead gains in homeownership
Asians and Latinos are making the biggest gains in home ownership in Texas, while Black homeowners are still lagging behind others, according to a National Association of Realtors report.
At 66% and 59% respectively, Asian and Latino groups reflected the growth seen among U.S. minorities in home buying. The rate of Black homeownership in Texas was 41% and homeownership for white Texans stood at 69%, slightly behind the national average of 72%.
Nationally, Asian home buying saw the largest strides from 2021, as the group’s rate of homeownership increased to 63.3%, according to the report.
The report comes as interest rates rise and the cost of owning a home has hit record levels. The average long-term U.S. mortgage rate rose for the fourth consecutive week last week, another setback for prospective homebuyers just as the spring homebuying season gets going. The average rate on a 30-year mortgage rose to 6.94% from 6.90% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 6.65%
Despite the decline in mortgage affordability throughout the last two years, said Orphe Divounguy, a senior economist at Zillow, millions of families have the means to afford a mortgage, the largest share of a homeowner’s cost.
“It’s crucial to recognize the existence of additional barriers beyond monthly cost, including access to funds for a down payment and closing costs — as well as other barriers that significantly contribute to mortgage denials, like insufficient credit scores and lack of access to credit. These barriers especially impact people of color.”
In Texas the maximum price, on average, Black renters can afford to pay for a home is $166,930. For white renters, it’s nearly $222,000, and for Latino renters, $179,000. Asian renters have the highest buying power for homes in Texas, as the group on average can afford a home costing upwards of $298,000.
The rate of Latino homeownership rose to 51.1%, Black homeownership rose to 44.1% and white homeownership rates fell slightly to 72%.
There are 10.5 million more homeowners in 2022 since 2012. Homeownership rates have consistently grown across all racial and ethnic groups in the U.S., according to the National Association of Realtors. However, the gap between Black and white homeownership continues to grow, now at 28 percentage points.
Factors affecting homeownership rates include demographic trends, affordability challenges and access to credit, according to the association.
“The ability and desire to own a home, a symbol of stability and achievement for many, are deeply intertwined with individual circumstances, local housing markets, and broader economic conditions,” the authors of the National Association of Realtors report stated.
The share of homeowners who spend more than 30% of their income on housing in Texas is highest among Black residents. More than 28% of Black homeowners are cost-burdened, according to NAR, 24.5% of Latino homeowners, 22.8% of Asian homeowners and 21.5% of white homeowners.