10 Cities Where Black Americans Fare Best Economically

Where Black Americans Fare Best Economically – 2021 Study – SmartAsset

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Nationwide, when it comes to wealth and personal finance success, Black Americans generally have less. Census data from 2019 shows that the median Black household income is 33% lower than the overall median household income and the Black homeownership rate is 22 percentage points lower than the general homeownership rate. Data on wealth accumulation depicts even starker disparities: Black families’ net worth is 87% lower than that of white families and 33% lower than that of Hispanic families, according to the Federal Reserve’s 2019 Survey of Consumer Finances.

Though the national picture is less than encouraging, economic outcomes for Black Americans are better in some places than others. In this study, we determined the cities where Black Americans fared best economically leading up to 2020. We compared 129 cities across six metrics: median Black household income, Black homeownership rate, Black labor force participation rate, poverty rate for Black residents, percentage of Black adults with a bachelor’s degree and percentage of business owners who are Black. For details on our data sources and how we put all the information together to create our final rankings, check out the Data and Methodology section below.

Key Findings

  • Six of the top 10 cities are located in Texas, Florida and North Carolina. These cities are Grand Prairie and Garland, Texas; Pembroke Pines and Miramar, Florida; and Charlotte and Durham, North Carolina. In both of the Texas and Florida cities, the median Black household income is higher than $61,000 and the Black homeownership rate is 46% or higher – compared to study-wide averages of about $43,000 and 35%, respectively. Meanwhile, Charlotte and Durham rank particularly well for our education and metro area business ownership metrics. In both North Carolina locales, more than 30% of Black adults have their bachelor’s degree and at least 3% of businesses are Black-owned – compared to study-wide averages of about 23% and 2%, respectively.
  • Preliminary 2020 estimates show that Black Americans have been disproportionately affected by not only the health impacts of COVID-19, but also its corresponding economic effects. The regional economic effects of COVID-19 on Black Americans are difficult to determine due to insufficient localized data, but the available national data paints a grim picture: Bureau of Labor Statistics (BLS) data shows that as of December 2020, the Black unemployment rate was 3.9
    and 3.2 percentage points higher than the white and overall unemployment rates, respectively. Additionally, the Black labor force participation rate was about 2.0 percentage points lower than both white and overall participation rates.

1. Virginia Beach (tie)

Virginia Beach, Virginia ranks in the top 10 cities for four of the six metrics we considered. It has the seventh-highest median Black household income, at roughly $65,600, and the sixth-highest 2019 Black labor force participation rate, at 78.7%. Additionally, Census Bureau data shows that the 2019 poverty rate for Black residents in Virginia Beach is 10%, fourth-lowest in our study. In the Virginia Beach-Norfolk-Newport News metro area, more than 5% of businesses are Black-owned, the seventh-highest percentage for this metric overall.

1. Grand Prairie, TX (tie)

Grand Prairie, Texas ties with Virginia Beach, Virginia as the city where Black Americans fare best economically. It has the fourth-highest Black labor force participation rate (at 79.9%) and the lowest Black poverty rate (at less than 5%) of all 129 cities in our study. Additionally, more than a third of Black residents in Grand Prairie have their bachelor’s degree and the median Black household income is more than $63,000. The city ranks sixth and 10th out of 129 for those two metrics, respectively.

3. Aurora, IL (tie)

Aurora, Illinois ranks in the top third of all 129 cities for five of the six metrics we considered, falling behind only for its metro area’s relatively low concentration of Black-owned businesses. It has the fourth-highest Black homeownership rate (about 52%), sixth-highest median Black household income (about $65,900) and 10th-lowest Black poverty rate (11.9%). Aurora’s Black labor force participation rate is 73.5%, ranking 15th overall for this metric. Moreover, more than 29% of Black residents in the city have their bachelor’s degree, ranking 26th overall.

3. Pembroke Pines, FL (tie)

Just north of Miami, Florida’s Pembroke Pines ties for the No. 3 spot. Across all 129 cities, it has the second-highest Black homeownership rate – 60.20% – and the sixth-lowest 2019 Black poverty rate – 10.6%. Additionally, incomes for Black households are relatively high. In 2019, the median Black household income was about $61,500, the 11th-highest in our study.

5. Miramar, FL

The Black homeownership rate in Miramar, Florida is the highest in our study, at 68.07%. This is about 26 percentage points higher than the 2019 national Black homeownership rate, which is approximately 42%. Miramar additionally ranks in the top 15 cities for three other metrics: its high median Black household income (about $66,300), its high Black labor force participation rate (74.1%) and its relatively low Black poverty rate (7.9%).

6. Charlotte, NC

Though the median Black household income in Charlotte, North Carolina – at a little more than $46,300 – is relatively low, Charlotte ranks in the top third of cities for the other five metrics we considered. It has the 28th-highest Black homeownership rate (41.45%), the 18th-highest Black labor force participation rate (73.0%) and the 14th-lowest poverty rate for Black residents (13.6%). Additionally, more than 30% of Black adults have their bachelor’s degree and almost 4% of businesses in the larger Charlotte metro area are Black-owned – both of which rank within the top 25 out of all 129 cities in the study.

7. Garland, TX

The Black homeownership rate in Garland, Texas is the fifth-highest in our study, at 50.98%. This city has the 11th-highest Black labor force participation rate, at 75.8%. It also ranks in the top 15 for its median Black household income ($60,030) and the percentage of Black adults with a bachelor’s degree (32.5%). Garland falls the most behind when it comes to the poverty rate for Black residents, which was 23.7% in 2019. That’s 1.2% higher than the national average for Black Americans and the worst of any city in our top 10.

8. Durham, NC

Only about two hours northeast of Charlotte, Durham, North Carolina takes the eighth spot on our list. The city ranks particularly well for its percentage of Black adults with a bachelor’s degree (35.2%) and percentage of Black-owned businesses in the larger Durham-Chapel Hill metro area (4.7%). Additionally, the Black labor force participation rate is the 30th-highest across all 129 cities in the study, at 69.4%. The poverty rate for Black residents is 35th-lowest overall, at 18.9%.

9. Enterprise, NV

Enterprise, Nevada had the fifth-highest 2019 Black labor force participation rate (79.0%), the 16th-highest 2019 median Black household income (about $58,500) and 23rd-best 2019 Black homeownership rate (roughly 43%) of all 129 cities in our study. Enterprise falls behind, however, when it comes to the number of Black-owned businesses in the larger Las Vegas metro area, at less than 2%. The city ranks 67th out of 129 for this metric.

10. Elk Grove, CA

The median household income for Black residents in Elk Grove, California is a little more than $76,300, the second-highest in our study (ranking behind only Rancho Cucamonga, California, where the median household income is almost $92,000). Elk Grove also ranks in the top 10 cities for its relatively high Black homeownership rate (52.51%) and the relatively high percentage of Black adults with a bachelor’s degree (35.1%). But like in Enterprise, Nevada, few businesses in the Elk Grove area are Black-owned. Annual Business Survey data from 2018 shows that less than 2% of employer firms in the greater Sacramento-Roseville-Arden-Arcade metro area are Black-owned.

Data and Methodology

To find the cities where Black Americans fare best economically, SmartAsset looked at the 200 largest cities in the U.S. Only 129 of those cities had complete data available, and we compared them across six metrics:

  • Median Black household income. Data comes from the Census Bureau’s 2019 1-year American Community Survey.
  • Black homeownership rate. This is the number of Black owner-occupied housing units divided by the number of Black occupied housing units. Data comes from the Census Bureau’s 2019 1-year American Community Survey.
  • Black labor force participation rate. This is for the Black population 16 years and older. Data comes from the Census Bureau’s 2019 1-year American Community Survey.
  • Poverty rate for Black residents. Data comes from the Census Bureau’s 2019 1-year American Community Survey.
  • Percentage of Black adults with a bachelor’s degree. This is for the Black population 25 years and older. Data comes from the Census Bureau’s 2019 1-year American Community Survey.
  • Percentage of business owners who are Black. This is the number of Black-owned businesses with paid employees divided by the number of businesses with paid employees. Data comes from the Census Bureau’s 2018 Annual Business Survey and is at the metro area level.

To determine our final list, we ranked each city in every metric, giving a full weighting to all metrics. We then found each city’s average ranking and used the average to determine a final score. The city with the highest average ranking received a score of 100. The city with the lowest average ranking received a score of 0.

Editors’ Note: SmartAsset published this study in celebration and recognition of Black History Month. Protests for racial justice and the outsized impact of COVID-19 on people of color have highlighted the social and economic injustice that many Americans continue to face. We are aiming to raise awareness surrounding economic inequities and provide personal finance resources and information to all individuals.

Financial Tips for Black Americans

  • See if homeownership makes sense. The Black homeownership rate is 22 percentage points lower than the general homeownership rate. Deciding whether or not to buy is often difficult. SmartAsset’s rent or buy calculator can help you compare the costs to see which one makes sense for your financial situation. Additionally, if you want to figure out how much you can afford to buy a house, our home-buying calculator will help you break down the target price for your income.
  • Some kind of retirement account is better than none. The Federal Reserve says that Black Americans are less likely to have a retirement account than white Americans. According to their 2019 Survey of Consumer Finances, 65% of white middle-aged families have at least one retirement account, while only 44% of Black families in the same age group have one. Even though 401(k)s are a popular retirement plan because employers could match a percentage of your contributions, an IRA could also be another great opportunity to boost your savings. In 2021, the IRA contribution limit is $6,000 for people under 50 and $7,000 for people age 50 and older.
  • Consider a financial advisor. A financial advisor can help you make smarter financial decisions to be in better control of your money. SmartAsset’s free tool matches you with financial advisors in your area in five minutes. If you’re ready to be matched with local advisors, get started now.

Questions about our study? Contact us at press@smartasset.com.

Photo credits: ©iStock.com/monkeybusinessimages, ©iStock.com/LeoPatrizi

Stephanie Horan, CEPF® Stephanie Horan is a data journalist at SmartAsset. A Certified Educator of Personal Finance (CEPF®), she sources and analyzes data to write studies relating to a variety of topics including mortgage, retirement and budgeting. Before coming to SmartAsset, she worked as an analyst at an asset management firm. Stephanie graduated from Williams College with a degree in Mathematics. Originally from Philadelphia, she has always been a Yankees fan and currently lives in New York.
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The 10 Worst States for Millennials

worst-states-for-millennials

Millennials are struggling. With rising student debt, stagnant wages, and avocado toast, many are working hard to hardly get by.

It is no surprise millennials are struggling financially. As a group, 24-39 years old earn less and have less assets than their parents did a generation ago. However, just like the job market and cost of living, where you live matters. We analyzed all 50 states and the District of Columbia to uncover where it is hardest for millennials to thrive.

Below we detail the criteria we used to rank the states and have the full ranked list. But first, let’s see the 10 states where millennials have it the roughest.

The south dominates this list with 5 of the top 10 being southern states. The other 5? Include some areas notorious for high costs of living or in economic distress.

Keep reading to see why these states have the least to offer millennials and to see the full list.

How We Determined The Worst States For Millennials

Each state and DC were ranked 1 to 51 in four categories:

  • Millennial Unemployment Rate
  • Average Student Loan Debt
  • Millennial Home Ownership
  • Percent Of Millennials Living In Poverty

All four categories were then averaged together, each weighted equally. The lower score in each category, the lower the rank. For example, DC’s $55,400 was the highest average student loan debt, earning it a rank of #1 for student loan debt.

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We used the most recent American Community Survey 2014-2018 data from the U.S. Census Bureau to get unemployment rate by state for those 25-34. The ACS data also provided the poverty rate by state for the 25-34 age demographic.

To analyze millennial home ownership, we once again used the ACS data to find the percentage of homeowners under 35 in each state.

To gather average student loan debt by millennial borrower, we used the most recent report from Educationdata.org.

If your state isn’t among the top 10, jump down to the bottom of the post to see where it lands on the full list. Otherwise, learn more about why these states are the worst place to be a millennial.

1. Mississippi

mississippi class=

Unemployment: 10%
Poverty Rate: 29%
Homeownership: 10%

It is no surprise to see Mississippi top the list of worst places to be a millennial. Mississippi often comes in dead last in education and quality of life metrics. Why is it so hard being a millennial in
the Magnolia state?

More than 1-in-4 Mississippi millennials live in poverty, in addition to facing the worst unemployment in the nation. While housing in Mississippi is relatively affordable, it’s simply not enough to help the millennials struggling just to get by.

2. Florida

florida class=

Unemployment: 7%
Poverty Rate: 22%
Homeownership: 7%

Florida may be a beloved destination for vacationers, but millennial residents may find themselves experiencing hardship. Not only do Floridian millennials stand a 22% chance of living in poverty, the state also the 3rd worst Millennial homeownership rate in the nation.

The beautiful surroundings can only provide so much comfort to adults striving to make a living.

3. Alabama

alabama class=

Unemployment: 8%
Poverty Rate: 27%
Homeownership: 10%

Alabama comes in at #3 for the worst place to be a millennial. While unemployment for millennials is 2% lower than Mississippi, it’s still not great. 27% of Alabama millennials are below the federal poverty rate.

4. South Carolina

south carolina class=

Unemployment: 7%
Poverty Rate: 22%
Homeownership: 10%

Just graduating college in South Carolina sets you up for an average $38,300 in student loan debt. Considering 7% of millennials are unemployed, it can’t be easy paying off those hefty student loan payments.

5. Georgia

georgia class=

Unemployment: 7%
Poverty Rate: 21%
Homeownership: 10%

Georgia tells a similar story to other southern states that top the list– a high poverty rate, paired with less than stellar unemployment. Toss in the high average student debt and it’s easy to see it isn’t all peaches for millennials in the peach state.

6. North Carolina

north carolina class=

Unemployment: 7%
Poverty Rate: 22%
Homeownership: 10%

North Carolina has similar stats to its neighbor, South Carolina- paired with worst homeownership and slightly less crippling debt.

7. West Virginia

west virginia class=

Unemployment: 9%
Poverty Rate: 32%
Homeownership: 9%

West Virginia is one of the states with a shrinking population. Every year residents are packing up and moving in hopes of a brighter future. Millennials in West Virginia have the highest poverty rate in the nation, with a depressing 1-3 live below the poverty level).

Pair that with sky high unemployment, and chances are pretty good wherever they move, the grass is greener.

8. New Mexico

new mexico class=

Unemployment: 8%
Poverty Rate: 27%
Homeownership: 10%

Why is it so rough being a millennial in New Mexico? A terrible 8% unemployment rate. Since jobs make creature comforts affordable, like food and shelter, this doesn’t bode well for millennials who call New Mexico home.

9. Oregon

oregon class=

Unemployment: 6%
Poverty Rate: 23%
Homeownership: 9%

In Oregon, more millennials are working than most other states. However judging from dismal homeownership rate and a surprisingly high poverty rate, folks are working just to get by in Oregon.

10. California

california class=

Unemployment: 7%
Poverty Rate: 20%
Homeownership: 8%

California may be the golden state, but for millennials living there may not look so shiny. High home costs mean home ownership is out of reach for many millennials. When paired with high unemployment and an unpleasantly high poverty rate, it earns California its spot at #10.

Some states offer Millennials worst opportunities than others

There you have it, the 10 states where millennials have the hardest time thriving.

At the end of the day, millennials are struggling nationwide. However, some states have less job opportunities, higher costs of living, and other blockers to achieving the American Dream– or even just not living in desperate poverty.

Where should millennials go for the best opportunities? Out west! Western states dominate the top 10 best states for millennials.

Best States For Millennials

  1. North Dakota
  2. Nebraska
  3. Iowa
  4. South Dakota
  5. Wyoming
  6. Minnesota
  7. Utah
  8. Wisconsin
  9. Kansas
  10. Colorado

If your state wasn’t in the top 10, you can see where it landed below.

See Where Your State Fell On The List:

Rank Geographic Area Name Unemployment(%) Poverty Rate(%) Homeownership(%) Student Debt
1 Mississippi 9 28 10 $36,700
1 Florida 6 21 7 $39,700
3 Alabama 8 26 10 $37,100
4 South Carolina 7 21 9 $38,300
5 Georgia 7 20 9 $41,500
6 North Carolina 6 21 9 $37,500
7 West Virginia 8 32 9 $31,800
8 New Mexico 8 27 10 $33,600
9 Oregon 6 22 9 $36,900
10 California 6 20 8 $36,400
11 New York 6 18 7 $37,800
12 Michigan 7 22 10 $35,900
13 Louisiana 7 26 11 $34,400
13 Tennessee 6 22 10 $36,200
15 Delaware 6 17 9 $37,000
15 Connecticut 7 17 7 $34,900
15 Hawaii 4 20 6 $36,500
18 Arizona 6 22 9 $34,100
19 New Jersey 6 17 7 $35,100
20 Illinois 6 18 10 $37,600
21 Maryland 6 15 9 $42,700
22 Pennsylvania 6 19 9 $35,400
23 Kentucky 6 24 11 $32,500
23 Ohio 6 21 10 $34,600
25 Nevada 6 20 10 $33,600
26 Maine 5 22 9 $32,500
26 Arkansas 6 24 11 $33,300
26 Virginia 5 16 9 $39,000
29 Rhode Island 6 18 8 $31,800
30 Vermont 4 15 8 $36,700
31 Missouri 5 20 11 $35,400
32 Massachusetts 5 16 8 $34,100
33 New Hampshire 3 15 8 $36,700
34 Washington 5 17 10 $35,000
35 Indiana 5 21 11 $32,800
36 Alaska 7 15 12 $33,600
37 Idaho 4 23 12 $32,600
37 District of Columbia 5 10 12 $55,400
39 Montana 4 21 10 $33,300
40 Oklahoma 5 23 12 $31,500
41 Texas 5 18 11 $32,800
42 Colorado 4 15 11 $35,800
43 Kansas 4 20 12 $32,500
44 Wisconsin 4 16 10 $31,800
45 Utah 3 20 15 $32,200
46 Minnesota 3 14 12 $33,400
47 Wyoming 5 17 13 $31,000
48 Iowa 3 19 13 $30,500
48 South Dakota 3 19 14 $31,100
50 Nebraska 3 17 13 $32,100
51 North Dakota 2 13 16 $29,200

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Source: zippia.com

What Is Redlining?

Homeownership is a major goal for many people. Not only is a house the biggest purchase many will ever make, but owning a home is a way to build and transfer wealth.

While nearly 75% of non-Hispanic white Americans were homeowners in 2020, the homeownership rate was almost 60% for Asian Americans and just over 49% for Hispanic Americans, according to the Census Bureau. Black Americans were the least likely of all minority groups to own a house, at just over 44% in 2020.

Why the stark disparity? The answer, in part, is redlining, a discriminatory housing policy that made it difficult for Black, immigrant and poor families to buy homes for several decades. While redlining was banned more than 50 years ago, its negative effects are still felt today.

Redlining definition

Redlining is a term that describes the denial of mortgage financing to otherwise creditworthy borrowers because of their race or where they want to live.

The term was coined by sociologist John McKnight in the 1960s. It refers to areas marked in red on maps where banks would not lend money, but the discriminatory practice began much earlier.

In the 1930s, as part of the New Deal, the federal government created the Home Owners’ Loan Corporation and the Federal Housing Administration to stabilize the housing industry.

The HOLC was designed to provide low-interest, emergency loans to homeowners in danger of foreclosure, while the FHA replaced high-interest loans of the early 20th century with longer-term, government-insured mortgages at lower interest rates.

To guide lending decisions, the HOLC instituted color-coded “residential security” maps. These maps separated areas the HOLC considered safe for lending from areas that should be avoided. Although the HOLC said the maps would help lenders assess risk and property values, racial biases were clearly at play.

Neighborhoods that were predominantly white were usually colored in green or blue and considered the least risky. It was easier to get home loans in these areas.

Areas with a high number of Black, Jewish and Asian families, which often had older homes or were closer to industrial areas, were typically shaded in red and labeled “hazardous.” Almost no lender would provide mortgages in these areas.

Areas that bordered Black neighborhoods were colored yellow and were also rarely approved for loans.

Effects of redlining

The grading of neighborhoods based on perceived credit risk restricted the ability of Blacks and other minority groups to get affordable loans or even to rent in certain areas.

Exclusion from government lending programs

The FHA, as well as private banks and insurers, used the HOLC’s redlining practices to guide their underwriting decisions.

As a result, it was almost impossible for nonwhite Americans to gain access to the affordable loans offered by agencies like the FHA and Veterans Administration — programs supposedly intended to expand homeownership.

In fact, nonwhite people received just 2% of the $120 billion in housing financed by government agencies between 1934 and 1962, historian George Lipsitz notes in his book “The Possessive Investment in Whiteness.”

Racially restrictive covenants

Racially restrictive covenants are agreements, often included in a property deed, that prevent property owners from selling or leasing to certain racial groups.

These covenants reinforced redlining by prohibiting Blacks and other groups from buying or occupying property in various cities throughout the country.

Although the GI Bill promised low-cost home loans to veterans of World War II, lending discrimination and racially restrictive covenants meant Black soldiers couldn’t buy homes in developing suburbs, for example.

Racially restrictive covenants remain in some real estate deeds, though a 1948 Supreme Court ruling says they aren’t enforceable.

Even so, decades later, Black and Hispanic Vietnam War veterans and their families encountered similar racial discrimination when trying to buy and rent homes in certain areas.

Is redlining illegal?

Angered by the inability of Vietnam War veterans of color to obtain housing, groups like the National Association for the Advancement of Colored People pressured the government to pass the Fair Housing Act of 1968.

As part of the Civil Rights Act, the Fair Housing Act made it illegal for mortgage lenders and landlords to discriminate against someone for their race, color, religion, sex or national origin.

Redlining maps may no longer be in use, but more than 50 years after the law was passed, housing discrimination still exists, says Andre M. Perry, a senior fellow in the Metropolitan Policy Program at the Brookings Institution.

Paired testing studies using equally qualified home seekers of different races have found that some real estate agents discriminate against people of color by not showing them properties in white neighborhoods or showing them fewer homes in general.

Perry also says research he published in 2018 shows homes in Black majority areas are undervalued by $48,000 on average, resulting in $156 billion in cumulative losses.

“Just because a law changed, it doesn’t mean the practices and procedures that still may devalue homes in Black neighborhoods, aren’t still there,” he says. “Ultimately, it’s the reduction of wealth that is the most harmful aspect of redlining.”

How redlining reinforced the racial wealth gap

The racial wealth gap is a term that describes the difference between the median wealth of whites compared with other groups. The median and mean net worth of Black families are less than 15% that of white families, according to Federal Reserve 2019 data.

The disparity exists today because Blacks were locked out of homeownership by redlining and were unable to build generational wealth, says Nikitra Bailey, an executive vice president at the Center for Responsible Lending.

“This persistent gap in homeownership opportunities between white families and families of color literally is rooted in the fact white families got a head start,” Bailey adds.

In fact, the homeownership divide between Blacks and whites is back to where it was in 1890, according to the National Fair Housing Alliance. And the gap is even larger than it was in 1968 when the Fair Housing Act was enacted.

Sheryl Pardo, a spokesperson for the nonprofit research organization Urban Institute, stresses that national, state and local policies are needed to address the homeownership and racial wealth inequities redlining has left behind.

The Urban Institute’s proposals include zoning laws to improve access to affordable housing, counseling before and after purchasing a home to prepare borrowers for the costs of homeownership, the expansion of down payment assistance programs and the development of financial products for homeowners to repair, maintain and improve their homes.

“Homeownership is still the most significant wealth-building tool in this country,” Pardo says. “If you want the Black community to make up that distance, homeownership has to be a key piece of it. It’s almost like you need a shock-and-awe response. It’s not going to happen by tweaking one little lever.”

Source: nerdwallet.com

New program puts Black real estate agents at forefront

The National Association of Real Estate Brokers and HomeLight has announced the creation of its “Black Real Estate Agent” program to provide financial, educational, and career support for aspiring Black real estate agents.

HomeLight is partnering with NAREB in this venture with the goal of ultimately improving the rate of homeownership for Black Americans across the country, according to Antoine Thompson, NAREB national executive director.

Black Americans represent less than 6% of all real estate professionals in the U.S., according to the Census Bureau.

“This initiative works to close the income and racial wealth gap in the industry,” Thompson said. “Together we’re holding open the door that would otherwise remain closed to Black professionals and consumers.”

Homeownership rates for Black Americans dipped to 44.1% in the fourth quarter of 2020. That’s despite an overall rise of 0.7% in homeownership in the fourth quarter of 2020.

As part of the Black Real Estate Agent program, HomeLight and NAREB will help cover up to $5,000 of the onboarding costs for new agents, including pre-licensing classes, agent exams and select marketing and technology needs. Each program participant will be paired with an experienced NAREB real estate counselor who will serve as a mentor and advisor.

The NAREB is seeking applicants in the United States who are between the ages of 18 and 35, are interested in a career in real estate but not currently established as an agent, willing to work with a NAREB broker during at least their first year in real estate, and committed to spending five to 10 hours per week working with mentors or on continuing education.

NAREB President Lydia Pope said “democracy in housing” cannot be reached without an increase of Black real estate professionals.

“Agents are the frontline and introduce homeownership to prospective clients,” Pope said. “We are confident that this new program will not only equip Black American program participants with the knowledge and practical experience to become top producers in their communities, but also significantly expand Black homeownership in their communities.” 

Black homeownership rate was the only demographic to decline year-over-year, according to the Census Bureau. White Americans increased homeownership in the fourth quarter to 74.5% – a nine-year high. Hispanic-American homeownership rose to its highest rate in three years, at 49.1% last quarter. Asian, Native, Hawaiian, and Pacific Islander homeownership was reported at 59.5% – up from the rate of 57.6% in the fourth quarter of 2019.

A report by Morgan Stanley showed that equalizing Black-White homeownership rates over the next 10 years would create more than 5 million more homeowners of color, generate nearly 800,000 new long-term jobs, and raise up to $400 million in additional tax revenues relative to current trends.

“Our goal is to drive sustainable, structural change by increasing access to job opportunities as well as education around how systematic racism has impacted the real estate industry,” said Sumant Sridharan, HomeLight COO. “We’re excited to partner with NAREB to offer this program to aspiring Black real estate professionals. Together, we believe we can fundamentally shift diversity and equality in our industry by increasing access to training, education, and support for Black real estate agents.”

Source: housingwire.com

Homeownership Rising Despite Seasonal Volatility

The homeownership rate fell in the fourth
quarter down 1.6 percentage points from its third quarter level but remained
higher than in the same quarter in 2019
. The U.S. Census Bureau said the rate,
65.8 percent, was up from 65.1 percent a year earlier.

The national rate had topped 69 percent at
several points during the housing boom in 2004 and 2005 before retreating. It
declined steadily through the Great Recession and into the recovery, reaching a
low of 62.9 percent in the second quarter of 2016.

Homeownership is consistently highest in
the Midwest, and that region posted an annual increase of more than a point in
the fourth quarter to 70.8 percent. The South was second at 67.7 percent, also
a point higher year-over-year. The rate was 62.6 percent in the Northeast and
60.4 percent in the West. The latter two regions were essentially unchanged
from the fourth quarter of 2019.  

The rate among those under 35 years of age
was 38.5 percent; and it was 61.0 percent for those in the next older 10-year
cohort. For those 45 to 54 years and 55 to 64 years the rates were 69.8 and
76.0 percent, respectively. As always, those 65 and older had the top rate,
80.2 percent. All age groups had lower rates than in the third quarter, but all
gained groups compared to a year earlier.

The black/white homeownership gap, which
had been narrowing recently, grew larger again over the last year. The rate for
non-Hispanic white households increased from 73.7 percent to 74.5 percent  while the rate for black households grew only
0.1 point to 44.1. The rate for Hispanic households increased 1 point to 49.1
percent and it was up nearly 2 points for Asian and Pacific Islander
homeowners.

The national vacancy rates in the fourth
quarter were 6.5 percent for rental housing and 1.0 percent for homeowner
housing. The rental vacancy rate was essentially unchanged from both the prior
quarter and a year earlier. Homeowner vacancies were also unchanged for the
quarter but rose 0.4 point from a year earlier.

The number of housing units nationally was
estimated at 141.241 million units, an increase of 1.167 million units year-over-year,
with 125.805 million of those units occupied. Of occupied units, 82.808 million
are homeowner units and 42.997 are rental units. The number of owner-occupied
units grew by 2.132 million
while rental units fell by 278,000.

The Census Bureau put the median asking
rent for vacant rental units at $1,190 per month
. The median asking price for
vacant units that were for sale was $214,600.

Source: mortgagenewsdaily.com

White homeownership rate hits nine-year high

Despite an unrelenting COVID-19 virus and economic recession, U.S. homeownership rose in the fourth quarter of 2020 from the same period last year. And it’s reached a record high for white homeowners, but fallen for Black Americans.

The overall homeownership rate in the fourth quarter of 2020 rose 0.7% above that of the fourth quarter of 2019, according to a new report from the U.S. Census Bureau. The share of Americans who own their own home was 65.8% in the fourth quarter of 2020, rising from 65.1% in the same period a year earlier, the Department said in a report on Tuesday.

That percentage is a drop, however, from the third quarter of 2020, which reported a robust 67.4% homeownership.

The homeownership rate for white Americans in the fourth quarter of last year was 74.5% – a nine-year high, and surpassing the fourth quarter of 2019’s rate of 73.7%. Homeownership rates for Black Americans dipped to 44.1%, the lowest rate since the first quarter of 2020.

Hispanic-American homeownership rose to its highest fourth quarter rate in three years, at 49.1%. Asian, Native, Hawaiian, and Pacific Islander homeownership was reported at 59.5% – up from the rate of 57.6% in the fourth quarter of 2019.


Making housing more affordable by bridging the affordable supply gap

In the last few years, the number of existing single-family homes for sale has decreased. But home prices have increased. To make homeownership a possibility for everyone, there needs to be a higher supply of affordable homes.

Presented by: Fannie Mae

Homeownership in Q4 2020 was highest in the Midwest – about 70.8%, according to the report. The South (67.7%), Northeast (62.6%), and West (60.4%) all reported homeownership rates above 60%, as well. All regions had higher fourth-quarter homeowner rates than in 2019.

The median asking sales price for vacant, for-sale units was $214,600 in the fourth quarter of 2020.

The average U.S. rate for a 30-year fixed mortgage fell to under 2.8% in the fourth quarter, which pushed up home purchases (though a lack of inventory and rising prices have hindered even higher rates of home ownership).

Approximately 89.1% of all housing units were occupied in the fourth quarter of 2020, and 10.9% were vacant. Owner-occupied housing units made up 58.6% of total housing units.

Owners over the age of 65 made up the majority of homeowners in the fourth quarter of 2020 at 80.2%. The under-35 crowd accounted for only 38.5% of homeowners.

It’s conceivable that the total number homeowners increases in the next few years, as well. President Joe Biden is hoping to pass a bill green-lighting a $15,000 tax credit for first-time homebuyers. If the bill is passed, those first-time potential buyers could use the $15,000 essentially as a down payment on the home.

This looms as a solution to prospective buyers looking to take advantage of historically-low mortgage rates brought on by the pandemic and recession.

Source: housingwire.com