Friday, May 24, 2024

According to study Latino and Black millennials own fewer homes which will increase wealth gap

Angely Mercado, 26, who has a Master’s degree in journalism, makes a living as a freelance writer; she hopes to land a full-time job at some point.

The New York resident was clear when she was asked where home ownership stood on her list of priorities. “I wish it could be higher, but it’s not financially possible,” said Mercado, who describes herself as very budget conscious and obtained scholarships so she wouldn’t have student loans like so many young people her age.

She’s part of a generation of millennials who are less likely than previous ones to buy homes, according to a new report from Better Mortgage. The authors point to a troubling trend — lower home ownership numbers at this rate will exacerbate wealth disparities among white millennials compared to their black and Latino counterparts, especially among the less educated.

For most Americans, owning a home is a major factor in the accumulation of wealth. According to the report, millennial home ownership rates plummeted across all races and ethnicities in 2015; the Hispanic and Asian American rates fell to 24.6 percent and 27.2 percent in the same year, for Whites it was at nearly 40 percent while for Blacks it was 13.4.

Millennials face significant barriers to home ownership, according to the report’s authors. These include high education debt, high rental costs, tight credit standards for mortgages and a shortage of affordable housing in urban, metropolitan areas.