Twenty years of efforts to bridge the racial gap in housing have yielded little or no results. While there has been an overall increase in homeownership since the 1980s, there is still evidence of sizeable and persistent racial home ownership gaps, according to research at the University of Southern California Lusk Center for Real Estate. Substantial gaps in homeownership rates between whites and minorities persisted, averaging roughly 26 percentage points for blacks and 28 points for Hispanics. In the second quarter of 2004, homeownership rates reached 69 percent nationwide, with 76 percent for non-Hispanic whites, 50 percent for blacks and 47 percent for Hispanics.
"Homeownership increases are driven by such factors as household income, age, size of the household, full-time work, marriage and inheritance," Lusk director Stuart Gabriel, Ph.D, points out. He adds that there remains a need to boost minority homeownership not only because it's often a wealth generator, but also because research has shown that homeownership can help to revitalize neighborhoods by reducing crime and blight, increasing price appreciation and improving outcomes for children. "Clearly, the benefits of homeownership can extend well beyond the build-up of equity to help revitalize communities," explains Gabriel.
Gabriel offers several steps that industry can take to increase minority homeownership including better access to credit, a look at loan pricing for minority and underserved communities, expanded use of alternative credit lines, and revitalization of existing housing stock in urban areas.
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