How to Overcome Modern Homeownership Challenges

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As we discuss the opportunities that homeownership creates for communities, we must also acknowledge the substantial ownership challenges that minority groups continue to face in the United States. In honor of National Homeownership Month, let’s explore the different American groups that continue to face challenges and the resources that can help bridge the gap.

LGBTQ+ Community

The national homeownership rate in the United States was 66% at the beginning of 2023, according to the U.S. Census Bureau data. But for American members of the lesbian, gay, bisexual, transgender, and queer community (LGBTQ+) who are between the ages of 22 to 72, the homeownership rate sits at just 49%. So, what has led to a gap of more than 10% for these Americans?

In a 2019 survey of members of the National Association of Gay and Lesbian Real Estate Professionals, more than half of survey respondents believed that their LGBTQ+ clients fear of experiencing discrimination during the homeownership process had an impact on the community’s homeownership rates. The most LGBTQ+-friendly states are often more expensive, forcing some homebuyers to settle for locations with fewer identity protections in place, according to the Balance. In addition to housing discrimination, LGBTQ+ people often face discrimination in education and employment, both of which may contribute to financial insecurity.

People with Disabilities

As of 2021, 12% of US residents ages 15 and older live with a disability. As defined by the US Department of Housing and Urban Development, 22% of people with disabilities live with “extremely low” incomes. Freddie Mac also reports that 23% of homeowners with disabilities don’t have enough income for basics like food and housing.

People with disabilities are less likely to be working when compared to those without. Many individuals with disabilities rely on multiple public and private agencies to meet their basic needs, including safe housing. Data from the Center for American Progress revealed that renters with disabilities report that their main obstacles for homeownership are not enough money for a down payment or closing costs (51%), and lack of credit history (43%).

Black, Indigenous, and People of Color

Black, Indigenous, and people of color (BIPOC) also have a lower homeownership rate than the average American. Based on Census Bureau data for the beginning of 2023, the national homeownership rate for Hispanic Americans was 49%, with Black American homeowners trailing behind at 45%, the lowest homeownership rate in the country.

The national median household income for Black Americans is nearly $30,000 less than the median income for white Americans. Black perspective homebuyers are sometimes denied for their debt-to-income ratios and low credit scores, as they are more likely to rely on credit cards for purchases, Forbes reports.

Achievable Homeownership for All

The Urban Institute, a nonprofit research organization that advocates for economic and social policy equity, projects that all new net household growth over the next two decades will be from BIPOC households. Acting now to increase homeownership among marginalized communities is an effective solution to strengthen the country’s economy and ownership rates. There are plenty of resources available to help qualifying buyers.

State Level Fair Housing Laws

Researching your state’s Fair Housing laws can help potential homebuyers recognize and know how to report discrimination. The United States Department of Housing and Urban Development also has resources available in both English and Spanish.

Credit and Mortgage Education

The National Housing Conference (NHC) shared that the major barriers keeping minority groups from achieving homeownership include their credit, student loan debt, and lack of information or resources for first-time and first-generation homebuyers. McGlone Mortgage works with a credit counseling service and regularly posts blogs and videos about homebuyer education. Getting in contact with a Licensed Loan Originator can also introduce you to homebuyer education classes local to your market.

Down Payment Assistance

Black young adults, whose parents are less likely to be homeowners and have wealth, are less likely to receive gift funds or down payment support from their loved ones, as compared to white young adults, according to the NHC. Down payment assistance programs, such as grants, loans, or matched savings programs, can be utilized for homebuyers who need additional resources.

Low Down Payment Financing

In addition to down payment assistance programs, McGlone Mortgage has a variety of government and niche mortgage products that have varying down payment requirements.

A Lender Who Cares

McGlone Mortgage is proud to be an Equal Housing Lender and we are committed to serving all borrowers fairly. To discover how we can assist in your homeownership dreams, contact us today! One of our Licensed Loan Originators will guide you through the process and answer any questions you may have.

(Sources: The Balance, Bankrate, National Association of Realtors, National Housing Conference, LGBTQ+ Real Estate Alliance, Forbes, UCLA, The Urban Institute, Center for American Progress, US Census)