For years, the myth of easy, accessible American homeownership and upward mobility—the caricatured image of white picket fences, suburban living, and keeping up with the Joneses—has needed a refresh in light of post-recession realities and the affordability crisis. But, with looming demographic shifts poised to change the U.S. housing market, it’s time for another change in popular perception.
The typical American homebuyer, like much of the rest of the country, is increasingly young and Hispanic. According to statistics from the 2016 State of Hispanic Homeownership Report, jointly released this May by the Hispanic Wealth Project and the (NAHREP), the U.S. is in the midst of a Hispanic homeownership surge. Since 2000, Hispanic households have increased by 6.7 million, representing 42.5 percent of the nation’s overall household growth, a trend only expected to accelerate. Latinos are expected to make up 52 percent of new homebuyers between 2010 and 2030, fueled in large part by the nation’s 14.6 million Latino millennials and growth in the increasingly diverse suburbs.
At a time when homeownership hovers near a 50-year low, more than 330,000 Hispanics formed new households last year. This is happening despite a low rate of inherited wealth in the Hispanic community, a shortage of low-cost housing options, and higher-than average loan refusal rates among potential Hispanic homeowners. Demographers note that high workforce participation and the “fervent desire to own a home” have driven growth in Latino home buying.
Many reports show this demographic playing an increasingly larger, and in some ways outsized, role in the U.S. economy. The most recent “State of the Nation’s Housing” study from the Harvard University Joint Center for Housing Studies (JCHS) predicts minorities will fuel for three-quarters of the gains in U.S. households, with Latinos accounting for one third of these gains. It’s a symbol, perhaps, of the economic strength of Hispanics, which make up 17 percent of the U.S. population. According to the U.S. Bureau of Labor Statistics, Hispanics accounted for 76.4 percent of the growth in the country’s labor force between 2010 and 2016, made up 20.8 percent of new entrepreneurs in 2015, according to the Kauffman Foundation, and started almost a million new, Latino-owned businesses between 2012 and 2016.
While it may not come as a surprise that Hispanics will represent the largest segment of the Texas population by 2020, according to state data, and will be the prime source of population growth in both the Lone Star State and California, Latino populations are also on the rise all across the country. Many of the fastest-growing Hispanic communities can be found across the South, in areas such as Russell County, Alabama, and Bryan County, Georgia. Even North Dakota, not a traditional center for Hispanic migration, has four of the top ten fastest-growing Hispanic populations in the country, according to Pew Research.
To learn more about the state of the real estate market or to get investing today, contact a member of the 9 Core Realty team.