Report reveals a grim new statistic
Black homeownership across the United States fell to its lowest level for nearly four years, sliding to 43.9% in the second quarter of this year. A new report from real estate giant Redfin said that rate was down from 45.3% the same time last year and hadn't been as low since the third quarter of 2021.
Redfin's chief economist Daryl Fairweather said rising unemployment was likely one of the reasons for declining homeownership rates among Black families. According to the Bureau of Labor Statistics’ August release, only 22,000 jobs were added last month, far below the 76,500 economists had expected. The unemployment rate edged up to 4.3% from 4.2%.
But the Black/African American unemployment rate recently climbed to 7.2% in July, up from 6.3% a year earlier. Black women saw a particularly sharp increase, with unemployment rising to 6.3% from 5.5%. For Black men, the rate ticked up to 7% from 6.6%. Meanwhile, unemployment among Hispanic/Latino, white, and Asian workers remained relatively stable.
Hispanic homeowners fared slightly better. The homeownership rate among Hispanics inched upwards to 48.8%. The non-Hispanic white homeownership rate fell to 74%, while the Asian/Native Hawaiian/Pacific Islander rate was down to 62.1%.
“The recent wave of federal layoffs hit Black households badly because government jobs have historically been an avenue of upward mobility for Black workers," Fairweather said. "DEI programs have also been dismantled in workplaces across the private and public sectors, which may have resulted in fewer Black employees being hired or promoted."
Affordability pressures and market shifts
Rising home prices and high mortgage rates have made homeownership elusive for many. But Fairweather sounded a positive note on the mortgage rate outlook, highlighting a recent drop in the average 30-year fixed rate to 6.5%.
“For Black households who feel locked out of the American dream, the good news is that affordability is improving as mortgage rates come down, home prices are growing at less than half the pace they were a year ago, and buyers have been gaining negotiating power,” he said.
The median monthly housing payment fell to $2,593 in late August, the lowest since January. Despite the lower payments, the market saw only a slight uptick in activity. Pending home sales rose 1.6% year over year, and new listings edged up just 1.1%, according to Redfin.
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