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Gauging the Trajectory of America’s Racial Homeownership Gap

For decades the rate of homeownership among Black, Latinx, Asian, and other minority demographics lagged far behind the rate among White Americans. That is due to a history of structural barriers.

The Urban Institute has found that even though those homeownership rates will continue to lag, demographic changes alone suggest that over the next two decades, the net growth in homeowners will be solely among families of color, according to research associates Lauria Goodman and Zun Zhu.

That said, changes in household and homeowner composition will look very different across states.

The Institute's "state fact sheet" series offers detailed statistics and projections about future household formation and homeownership for each of the United States.

Breaking it down to more digestible analysis, UI is taking a look at four states with very different racial and ethnic compositions and, its researchers expect, a wide range of possible homeownership trajectories over the next two decades.

Those sample states include Texas, Georgia, California, and Minnesota.

" Texas has the highest share of Hispanic families in the nation; Georgia has the highest share of Black families; California has the highest share of families of Asian descent as well as families that are not white, Black, or Hispanic and the second-highest share of Hispanic households; and Minnesota has mostly white households.," explain the research associates before going into further detail on each region.


The number of households in Texas is expected to increase from 10.1 million to 13.2 million, 31.5% compared with the national average of 12.4%. Households in the Lone Stat State were very diverse in 2020, according to Institute researchers: 48% White, 13% Black, 32% Hispanic, and 6% Asian and other.

"By 2040, we project Texas will be even more diverse: 38% of households will be White, 15% will be Black, 38% will be Hispanic, and 9% will be Asian and other households."


Institute researchers project the number of new Georgia households will increase from 3.9 million to 4.8 million, a 21.5% increase.

"In 2020, Georgia was composed of 56% white families, 31% Black families, 7% Hispanic families, and 5% Asian and other families, the researchers report. "By 2040, we expect Georgia to be more diverse: 47% of families will be White, 35% will be Black, 10% will be Hispanic, and 8% will be Asian and others."


The number of California households is expected to increase from 11.5 million to 13.2 million, a 7.3% increase that’s much lower than the national average of 12.4%. It is one of the most diverse states, UI shows.

"Even though the Hispanic and Asian populations will grow as a share of California’s population from 2020 to 2040, the share of Hispanic households living in California is expected to fall from 23.1 to 19.5 percent, and the share of Asian and other households is expected to decline from 25 to 22% because the state is experiencing below-average household formation growth."


The overall homeownership rate in Minnesota is high (71.9%) because of the high White homeownership rate (77.6%), but the Black homeownership rate is among the lowest in the nation (21.0%). This is the largest homeownership gap between White and Black households in any state.

Urban Institute: "We expect this gap to narrow dramatically over the next 20 years, from 56.6 percentage points to 49.3 percentage points, as the Black homeownership rate increases 8.6 percentage points. The number of net new homeowners will be more than 200,000: 40,000 of them White, 50,000 of them Black, 40,000 of them Hispanic, and 70,000 Asian and others."

Again, the institute has detailed intel and projections for every state and they say, "The housing industry and state and federal policymakers need to be aware of these trajectories so they can prepare for and support homeowners of all races and ethnicities."

The entire report is available at Urban.org.

About Author: Christina Hughes Babb

Christina Hughes Babb is a reporter for DS News and MReport. A graduate of Southern Methodist University, she has been a reporter, editor, and publisher in the Dallas area for more than 15 years. During her 10 years at Advocate Media and Dallas Magazine, she published thousands of articles covering local politics, real estate, development, crime, the arts, entertainment, and human interest, among other topics. She has won two national Mayborn School of Journalism Ten Spurs awards for nonfiction, and has penned pieces for Texas Monthly, Salon.com, Dallas Observer, Edible, and the Dallas Morning News, among others. Contact Christina at [email protected].

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