“Despite the significant decline in mortgage affordability in the past two years, millions of families who do not own their home have the means to afford the largest share of a homeowner’s cost — the mortgage,” said Zillow senior economist Orphe Divounguy.
However, he emphasized that income isn’t the only obstacle.
“It’s crucial to recognize the existence of additional barriers beyond monthly cost, including access to funds for a down payment and closing costs — as well as other barriers that significantly contribute to mortgage denials, like insufficient credit scores and lack of access to credit,” Diyounguy said in the report. “These barriers especially impact people of color.”
The report also notes a sharp decrease in the number of families able to afford mortgages, from 12.9 million in 2021 to 6.3 million in 2022, largely due to soaring mortgage rates. Interestingly, the median family income of Black renters has increased more than that of White renters since 2012, particularly in areas where Black incomes grew the most.
Cities like Detroit, Memphis, St. Louis, Houston, and Cleveland have seen the highest percentages of Black renting families who can afford a mortgage. Despite lower home values in these areas making mortgages more accessible for Black families, the path to homeownership remains fraught with challenges.
Source: mpamag.com