Black Homeownership Rate At Lowest Level In Nearly Four Years

Even as the country’s home ownership rate has fallen broadly, the rate among Black households has fallen further.

A new report from real estate brokerage Redfin says the rate among Black families fell to 43.9% in the second quarter, the lowest level since the fourth quarter of 2021. A year ago, the rate was 45.3%, making the current rate the largest year-over-year decline since the third quarter of 2021.

The overall homeownership rate nationally fell to 65% in the first quarter, according to the St. Louis Fed. That marks the lowest level since 2019, and a 4 percentage point decline since 1969.

Meanwhile, the ownership rate among Hispanics inched up from 48.5% to 48.8% in the second quarter, Redfin reported. But there were also small dips in the rates among non-Hispanic White families — from 74.4% to 74% — and for Asian/ Native American/ Pacific Islanders, from 62.8% to 62.1%.

Redfin Chief Economist Daryl Fairweather cited rising unemployment as “one likely reason” for the drop-off in Black home owners. “The recent wave of federal layoffs hit Black households badly because government jobs have historically been an avenue of upward mobility for Black workers,” she noted. 

“Behind the decline in Black homeownership are families who aren’t building stability and wealth through housing.” —Daryl Fairweather, Chief Economist, Redfin

The economist also noted that Diversity, Equity, Inclusion (DEI) programs have been dismantled in workplaces across the private and public sectors, which may have resulted in fewer Black employees being hired or promoted.

The Black/African American unemployment rate was 7.2% as of July, up from 6.3% a year earlier and the highest level since October 2021. Unemployment rates for other groups were relatively steady, with the Hispanic/ Latino unemployment rate declining to 5% from 5.3% while the White unemployment rate dipped from 3.8% to 3.7%. The Asian unemployment rate rose to 3.9% from 3.7%.

Black women have experienced an especially large jump in joblessness. Their unemployment rate jumped to 6.3% in July from 5.5% a year earlier, a substantial 14.5% increase. The unemployment rate for Black men was higher but saw a less dramatic jump — to 7% from 6.6% a year earlier, an increase of 6%.

Takeaways

The data are consequential, and mortgage professionals should take note: An analysis last year by the National Association of Realtors shows that 33% of Black/ African-American homebuyers were single women, far outpacing single men, who represented 12% of Black/ African-American buyers.

“Behind the decline in Black homeownership are families who aren’t building stability and wealth through housing,” noted Fairweather.