NEW YORK CITY -- As Hispanics keep establishing themselves as a key demographic for national development across different industries, one particular sector saw a significant increase in Latino and Hispanic participation— Real Estate.
The Hispanic homeownership rate reached 49.5 percent last year, with a net gain of 377,000 Hispanic owner-households compared to the year prior, according to a recently published report by the National Association of Hispanic Real Estate Professionals (NAHREP). This figure represents the largest increase in homeownership rate across all racial or ethnic demographic groups.
This trend has made Latinos disproportionately drive the U.S. homeownership growth, the study argues. Over the last ten years, Hispanic households have been responsible for 25.6% of the country's overall homeownership growth, despite making up 14.8% of households.
As Hispanics and Latinos gain more power and representation in real estate, what trends should the general public know about in regards to this demographic and the industry?
Century 21 agent and President-elect of NAHREP, Nora Aguirre, recently sat down with The Latin Times to discuss the current climate of Hispanics in real estate and their preferences when it comes to homeownership.
This interview has been edited for length and clarity.
What do you think is the importance for Latinos to own their homes?
It is well known that your home is pretty much the bridge or the gateway to creating wealth for everybody. And so, specifically for Latinos, it's just the American dream. I think that is one of the things that we strive to really do, to work hard. And then one of those things that is right there on the checklist is to become a homeowner.
As far as being a specific thing to Latinos, I would say that it's just for everybody in America. Homeownership is really the gateway to the middle class. And we believe that we stand behind that. Of course, we want our Latinos to participate in that and grow. Being able to be well versed when it comes to investing, knowing you can go into stocks, you can go into other small business owners, we know that Latinos are also very active in that space. Entrepreneurship is important to them. But your home really should be your first place to start off, right and really getting your foot on the right direction towards building wealth.
What trends have you seen in regards to Latino homeownership and Latino homeownership rates in the past couple of years?
At NAHREP, we release our state of Hispanic homeownership report every year. We actually just released our state of Hispanic homeownership recently. The numbers that have come out for the Hispanic homeownership rate in America is 49.9%. This means that we have consecutively been growing for the last nine years. So we are the only minority group that actually has seen an increase over this nine year span. That's important.
But we still have quite a way to go because we know that the Urban Institute has projected that by 2040, approximately about 15 years from now, 70% of all first time homebuyers will be Hispanic. This is because Latinos are young. So Latinos are just entering their home buying years. No other demographic can really say the same thing. We're young, we are growing. And so it's exciting to see these trends.
Besides education, what other factors do you believe have contributed to this increase in Latino homeownership?
Through NAHREP and Century 21 I know that the importance is their partnerships. They've made sure to partner up with leaders, organizations that are aligned with the same mission, and grow Hispanic homeownership in America. So when you have big organizations actually taking action and putting their money where their mouth is, well, that's when we truly start seeing what we're seeing right now: the change. There's a lot of connections that happen through the organization in order to help leaders continue to grow and bring those resources really to the ground level to our communities.
Then I think one of the most important parts is what we advocate for. At NAHREP we advocate for policies that really make sense for our community. As a matter of fact, we recently released our policy priorities for 2024. And so you'll see in those policy priorities that there's mention about immigration, and what does that have to do with real estate? Well, people might not think that has much to do with it, but the reality is that we have a shortage in housing. And many folks in the construction industry say that there's a lack of workers, there's a lack of opportunity for them to move forward and create more housing. And so immigration laws are very important in this sector.
We're doing the work that needs to be done, so that we can go out there into the community and provide these resources for our Latinos.
Have you seen any unique challenges or opportunities that have been presented of Latinos at the time of entering the homebuying process?
I can tell you a lot of challenges. One of the main ones: we know that the way that Latinos create credit is different, we also understand that the way they qualify is different.
But to talk about the things that are going positive, and especially in this market right now, where affordability is an issue, is that we're seeing multi generational households being built everywhere in America now. Because of the affordability factor, people can no longer have one family household. It's very common to see Latinos rooming with someone and different generations within their family. This has been "la cultura" (the culture), right? For Latinos, this is not new, it's new for everyone else. I think one of the strengths for Latinos, to be able to continue to push forward, because we're not shy to say "let's live together in the same house," let's save money, while the other person can then prepare to become a homeowner, I see that every single day. Even in these challenging times, where affordability is an issue, we've seen that that's where the strengths for Latinos are.
As for challenges, there's a lot. Lack of inventory in the price point where a lot of first time homebuyers are in is one of them. You just are not going to see certain cities in America where homes, houses, single family residencies being built in the price points for a starter home. It's going to be a condo, it's going to be a townhouse. We are asking for certain changes to happen when it comes to policies in this sector as well on how FHA views condos and how the financing goes through. But again, we can hear all day as far as we talk about the obstacles. But the good thing that we're seeing is that we are embracing the challenges, and that's why we are the only ones that are really seeing an increase despite all the challenges. So I think that should speak on the resilience of our community, and how we will find a way and we will come together to get the job done.
Have you seen any shifts in priorities among Latino homebuyers in recent years?
I will say that having a bigger lot sometimes is important for them. Not necessarily that kind of cookie cutter townhouse condo model. They strive to have a little bit of space because we are more about the "familia" coming over and spending some time. Especially when it's a first home owner and the family that buys, I see the story often where it's "I'm the first one that has my own house. And so all the parties or all the gatherings are going to be at my house now." And so they want a little bit extra space as much as they can get.
So yes, I see them looking forward to getting that extra space and getting even. So if they can get an extra bedroom for the same price they'll do that. And we see them being more willing to move outside of their box in order to achieve that.
We've also been seeing on our report what we call the opportunity markets, where we're seeing Latinos move across state lines in order to have more access to a home versus where they're at. Even if they're going to make a little bit less, they're willing to move us across state lines, in order to be able to become homeowners and have a stable presence in their community rather than just rent, rent, rent, and never really see the exit on that.
You mentioned earlier how Latinos are predicted to be 70% of all first-time homeowners by 2040. What other trends do you think we will be seeing in the future?
What I hope to see in the future is just the alignment between more companies partnering, connecting, and really joining forces, so that we are able to continue to advocate for the policies that make sense, so that we can continue to get our Hispanic community into hauls.
So we are looking for the support of leaders to really help us push and continue to have a voice so that the resources are there for the Latino community, and that the real estate professionals that work very hard to continue to help and support homebuyers get the right attention that the story is told correctly, because we know that first time home buyers need a lot of hand holding.
The future looks bright, but there are some challenges ahead. And we know that there's gonna be a lot of hard work, but if there's something that we're not afraid of as Latinos is just that.
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