Report: Access to Home Ownership Encouraging for Blacks/Latinos in RivCo

LOS ANGELES (CNS) – Riverside County was among the most affordable counties statewide for Black and Latino home buyers, even as home prices soared and interest rates jumped throughout California, the California Association of Realtors reported Wednesday.

The affordabilty factor for both groups bucked a trend seen throughout the state, where just 12% of Black and Latino households could afford an $822,320, median-priced single-family home in 2022, based on a 20 percent down payment, the association found.

In Riverside County, a minimum annual income of $139,600 was needed to qualify for the purchase of a $615,000 median-priced, existing single- family home in 2022. The monthly payment, including taxes and insurance on a 30- year, fixed-rate loan, would be $3,490, CAR determined.

The association found that, with an affordability index of 31% for Black people — the same figure as whites — Riverside was among the most attractive counties in the state for the Black home buyers. Asians and Latinos, too, had high affordability numbers, at 36 and 24, respectively. The index measures the degree to which a typical family can afford the monthly mortgage payments on a typical home.

Throughout the state, 21% of residents earned the minimum income needed to purchase an $822,320, median-priced home in 2022, down from 27% in 2021. At the same time, housing affordability for white/non-Latino households fell from 32% in 2021 to 26% last year, according to the association.

Meanwhile, 12% of Black and Latino households could afford the same median-priced home in 2022, down from 16% and 17% in 2021, respectively. The significant difference in housing affordability for Black and Latino households illustrates the homeownership gap and wealth disparity for communities of color, which could worsen as the economy slows and rates remain elevated this year, CAR said.

Housing affordability was better for Asians but also declined from the prior year, with the index registering 31% of Asian home buyers who could afford the median-priced home in 2022, down from 38% in 2021, according to the association’s Housing Affordability Index.

CAR reported that, statewide, the housing affordability gap between Blacks and the overall population in California improved from 11.7 percentage points in 2021 to 9.8 percentage points in 2022, while the gap for Latinos improved from 10.5 percentage points in 2021 to 9.4 percentage points in 2022.

According to the Census Bureau’s American Community Survey, the 2021 homeownership rate for all Californians was 55%, 63% for whites, 60% for Asians, 44% for Latinos and 37% for Blacks.

A minimum annual income of $186,800 was needed to qualify for the purchase of the $822,320 median-priced, existing single-family home in 2022 in the state, CAR determined.

The monthly payment, including taxes and insurance on a 30-year, fixed- rate loan, would be $4,670, assuming a 20% down payment and an effective composite interest rate of 5.47%. The 2022 California median income for whites was $105,640, $120,040 for Asians, $76,310 for Latinos and $64,190 for Blacks — an income gap of nearly one-third that of the overall population, which was $93,380, CAR reported.

Copyright 2023, City News Service, Inc.