Homeownership in the Hispanic population increased for the third consecutive year according to a joint report by The Hispanic Wealth Project, and the National Association of Hispanic Real Estate Professionals (NAHREP).
The report analyzes Hispanic labor force participation rate, household formation rate, median income and aspirational interest, to evaluate and determine the factors affecting homeownership for this group.
Attributing this growth to increasing population, growth in jobs, and household formations, the report found that Hispanics increased their rate of homeownership from 46 percent to 46.2 percent, with a net increase of 167,000 new owner households.
“We see from the report’s data the strong enthusiasm for homeownership within the Hispanic community,” said Daisy Lopez-Cid, President, NAHREP. “With a growing Hispanic population and the highest rate of workforce participation, Hispanics are expected to drive growth in the housing market for decades.”
According to the report, overall U.S. homeownership rates increased from 63.4 percent in 2016 to 63.9 percent in 2017, with over 1.1 million owner households for all population segments. Of these, Hispanics accounted for 15 percent of the net ownership gains.
In terms of household formations, the report noted that Hispanics accounted for 265,000 new household formations or, 28.6 percent of total U.S. household formations representing a modest fall from 340,000 household formations by Hispanics in 2016.
Despite these gains, three main factors slowed the growth of homeownership among Hispanics, the report indicated. They included a shortage of housing inventory, natural disasters, and uncertain immigration policy.
Giving examples of areas and metros that were heavily populated by Hispanics, the report indicated that affordable housing remained the main concern for the group. The report said that In Las Vegas new home starts were up 9 percent in 2017 but, only 21 percent of those were under $300,000, as compared to 42 percent in 2016.
San Diego began 2017 with a surge in new homes priced at $1 million and more even as this metro continued to experience severe supply constraints at the affordable price points. Giving the example of Houston, the report said that Houston saw growth with new home starts up 5.8 percent; however, its greatest increase was for starts above $300,000, which increased by 11.1 percent.