A Call to Action to all First Time Home Buyers

 Owning a home can provide a sense of freedom and stability in the present, as well as the future, and is often viewed as a milestone. While not everyone wants to own a home, many people face barriers that prevent them from becoming homeowners. In previous posts, I have discussed the ways discriminatory redlining strategies continue to impact the community, as well as the market today. This article will describe the extent of the homeownership gap between age and racial groups. If you have not bought your first home, consider these points and research first-time homebuyer programs in your area to help bridge the gap. 

A Reduction in New Families Buying Homes

An article titled Home Ownership and the American Dream by Laurie S. Goodman and Christopher Mayer provides insight into the ways trends in homeownership have varied over the years. According to the article, studies found that in 1985 married couples with at least one child under 18 were the largest group buying a home at 28.8%, and in 2015, this number dropped to 19.7% (Goodman and Mayer, 2018). It is clear that this group likely benefits from homeownership because the rate at which they were buying homes was once much higher. People see the benefit of being a home but it has become more difficult to buy and keep a home over the years. The same article provides a statistic that explains that homeownership rates for black households have fallen each decade for the past 30 years and that in 2015 black households with a college education were less likely to own a home than white households whose head of the household did not graduate from high school (Goodman and Mayer, 2018). This data is essentially displaying that black people have always struggled to become homeowners and factors such as education are not changing this. 

The Racial Gap Within Homeownership Trends 

The article An Essential Role for Down Payment Assistance in Closing America’s Racial Homeownership and Wealth Gaps provides a statistic surrounding homeownership that truly puts things into perspective. Authors Michael Stegman and Mike Loftin explain that at the time of the great depression, the gap between black and white homeowners was 30% and since then it has grown to 50% which is larger than when discrimination was legal within the housing market (Stegman and Loftin, 2021). Despite discrimination within the housing market being outlawed, the gap between black and white homeowners has only grown larger. While this number represents the population, it does not truly reflect the lives of the people it includes. If discrimination is no longer legal there must be an additional barrier contributing to this gap that must be addressed.

It is no secret that there are multiple benefits to owning a home whether it be for your family, retirement, or overall financial stability. Becoming a homeowner includes tax advantages, alternative savings, and fixed payments. However, these benefits only pay out if the homeowner can withstand downturns and keep the home, which is most often a challenge for low-income groups (Goodman and Mayer, 2018). This does not mean low-income individuals should not become homeowners but rather emphasizes the importance of becoming knowledgeable about the market and being prepared financially before purchasing. 

Age Gaps Surrounding Homeownership 

Trends in homeownership show that older individuals are more likely to be homeowners for retirement security. According to the article from Goodman and Mayer in 2005, there was a peak in homeownership for all age groups but that peak was less than a 1.5% increase in homeownership for individuals aged 35-54 in the last 20 years before 2005 and the largest increase in ownership was households with a head aged between 65-84. Despite the freedom and financial security homeownership can bring, young people are not buying homes anymore and have not been for a long time. 

Call to Action 

If you are between the ages of 35-54 or younger and do not own a home, consider looking into homeownership programs in your area. Many young people are eligible for first-time home buyer programs so be sure to research the best option for you. The luxuries of homeownership are not out of reach!

Goodman, L. S., & Mayer, C. (2018). Homeownership and the American dream. Urban Institute. https://www.urban.org/sites/default/files/publication/96221/homeownership_and_the_american_dream_0.pdf.

Stegman, M., & Loftin, M. (2021, April). An-essential-role-for-down-payment-assistance-in- closing. Urban Institute. https://www.urban.org /sites/default /files/publication /104134/ an-essential-role-for-down-payment-assistance-in-closing-americas-racial-homeownership-and-wealth-gaps.pdf.