More Americans than ever own a home, but the gap between Black homeownership and everyone else’s has increased over the past decade, the National Association of Realtors (NAR) said on Tuesday.
Using Census data, the new study published by America’s largest trade group explained that the number of homeowners across the country grew “significantly” between the years 2012 and 2022—by another 10.5 million people. The rate for white Americans climbed three points from 69.2% to 72.3%. Asian Americans saw a steeper jump, from 57.2% to 63.3%, an all-time high. Hispanic Americans enjoyed historic gains of their own, moving from 45.7% a decade ago to a record 51.1%.
But progress for Black Americans was less impressive. Their homeownership percentage increased from 42.5% in 2012 to 44.1% in 2022. Not only is the percentage the lowest, but the rate of change is also most stagnant: The delta between white and Black homeownership percentages worsened since 2012, growing from 27 points to 28 points.
“While homeownership rates have improved across all racial and ethnic categories over the past decade, the homeownership rate among Black individuals continues to trail behind significantly,” the trade group said in a statement, with deputy chief economist and vice president of research Jessica Lautz adding, “While the gains should be celebrated, the pathway into homeownership remains arduous for minority buyers.”
The group’s paper zooms out to a 10,000-foot view, putting those 10.5 million new homeowners into better focus: The rate climbed nationwide from 63.9% to 65.2% by 2022—yet that 2022 percentage also dropped 0.2 points from 2021’s 65.4%, thanks to the affordable housing crisis and high mortgage interest rates.
The report also breaks down ownership on a more granular level, by state, where the disparities can really drive home the racial gap: In North Dakota, it’s 69% white ownership to 19% Black ownership. In Wyoming, it’s even worse—74% to 19%. Eighty-three percent of white Americans own their home in Delaware, while 79% do in South Carolina and Michigan. The narrowest gap is in Washington, D.C., the only market where no racial group cracks the midpoint: 47% for whites, 34% for Blacks, 39% for Asians, and 44% for Hispanics.
The group’s report spells out why the challenges that would-be homebuyers of color face are a particular obstacle. Black Americans struggle to save for down payments, they report the highest levels of student-loan debt (41% of them carry debt, and it’s a record high $46,000), and they draw disproportionately from their 401(k)s and pensions. This is explainable partly by the differences in median net worth: A typical white family’s in America was $284,310 in 2022—more than six times greater than a Black family’s, at just $44,100. But Black and Hispanic groups are denied mortgages in greater numbers than their white and Asian counterparts, and those who do obtain loans often score ones at above-average interest rates. According to the NAR report, one-fifth of Blacks and Hispanics were given interest rates over 6% for 2022, when the average rate for that year was 5.34%.
The U.S. Department of Housing and Urban Development calls increasing homeownership the single biggest way to bridge America’s pernicious wealth gap. Homeowners can obviously leverage the equity they’ve built in their current home to help them purchase a new one. But when Black owners get their homes appraised, they see less appreciation than white owners do. Last week, a report by Axios crunching Zillow data showed that, in fact, the typical U.S. home with Black owners is worth 18% less than their white counterpart’s ($291,000 versus $354,000). Efforts to stamp out perceived racial bias and diversify the home-appraiser field are underway, but currently, more than 97% of home appraisers are white, according to the U.S. Bureau of Labor Statistics. In fact, only 6% of agents and brokers in America’s real estate industry are Black.
