By Kathryn Reynolds, Photo: ungvar/Shutterstock, Housing Matters, June 28, 2023
The current housing market is daunting for first-time homebuyers. In most markets, home prices have only decreased slightly since the record highs during the pandemic, and recent interest-rate hikes pushed the 30-year mortgage rate to its highest levels in two decades.
For Black and Latinx households, who are most likely to be first-time homebuyers, homebuying obstacles can be even greater than for white buyers because of the historical and ongoing effects of structural discrimination. The legacies of housing and labor discrimination mean households of color tend to have lower incomes than their white counterparts, are less likely to receive intergenerational wealth transfers to help with down payments, and often have less established or poorer credit histories. In fact, the homeownership gap between Black and white households is currently at its widest in 10 years.
Though homeownership is not a silver bullet for wealth-building, owning a home provides significant stability and can lower housing payments over time. Therefore, it’s imperative that policymakers, lenders, and service providers quickly learn how to navigate the current market to ensure equitable access to this opportunity for stability.
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