Latinos are coming into the “age of homeownership,” according to the 2020 State of Hispanic Homeownership Report: Homeownership rates increased for the sixth year in a row—making Latinos the only demographic to have six consecutive years of homeownership rate growth.
Sol Trujillo, co-founder of L’ATTITUDE, and National Association of Hispanic Real Estate Professionals (NAHREP) co-founder and CEO Gary Acosta recently participated in an online discussion about the report and the future of Latino homeownership. NAHREP has published this report for the last 11 years.
“Latinos actually outperformed the market in 2020—and maybe had their best year ever in terms of new homeownership acquisition. It was surprising even to us,” Acosta said. “It’s really a testament to the resilience of the Latino community, the fact that the Latino community has all of the metrics going for it: youth, workforce participation and a strong desire for homeownership.”
In the 10 years leading up to the pandemic, Latinos accounted for more than 50% of homeownership growth in the U.S., a trend that is expected to accelerate during the next two decades. In fact, all future homeownership growth will come from non-white households, and Latinos are projected to make up 70% of that homeownership growth over the next 20 years, according to the Urban Institute.
During the same time frame, the national homeownership rate for the country is predicted to decline in 2040 from 65% to 62%, while the Latino homeownership rate will increase to 51.3%
The Latino population in the U.S. has been aging into their prime homebuying years, the report states, which remains the biggest catalyst for homeownership growth. The median age of Latinos is currently 29.8, making that demographic 14 years younger than the non-Hispanic, white population. In 2020, 43.6% of Latino homebuyers were 34 or younger, compared to 37.3% of the general population. Nearly one in three Latinos are currently in their prime homebuying years (between the ages of 25 and 44).
Here is some of the data from the 2020 report:
- Between 2000 and 2020 the number of Hispanic homeowner households increased by 8.8 million, gaining 725,000 units in 2020 alone.
- The Hispanic homeownership rate increased by nearly 49% in 2020.
- Hispanics accounted for 35.9% of household formation growth between 2010 and 2020.
- Between 2020 and 2040, 70% of new homeowners (4.8 million) will be Latino.
- In 2019 there were 8.3 million “mortgage ready” Latinos younger than 46.
- Undocumented workers contrubute $1 trillion to the U.S. gross domestic product.
- Hispanics are expected to account for 64.8% of U.S. labor force growth between 2020 and 2029, adding seven million workers.
U.S. Hispanic population growth is driven predominantly by U.S.-born Latinos, rather than via immigration, according to the report. As of 2019, 67.2% of the U.S. Hispanic population was U.S.-born, an increase of 3.5% from 2014.48, whereas foreign-born Hispanics tend to be older (average age about 44). Today, 94.3% of the Hispanic population under 18 is U.S.-born.
Between 2010 and 2019, immigration from Latin America only accounted for 25% of immigration into the U.S., compared to 70% from Asian countries. Between 2018 and 2019, the largest percentage of new immigrants stemming from Latin America came from Guatemala, Honduras, and Venezuela.
Latinos in the U.S. come from 20+ Latin American countries, and the gains Latinos have made in homeownership have not been consistent across all Latino subgroups. In 2019, the overall Hispanic homeownership rate was 47.5%, but for Afro-Latinos it was just 41.8%.
Bolivians, who are among the smallest populations of Latinos living in the U.S., have the highest homeownership rate in the U.S., at 64.1%. Latinos of Mexican, Puerto Rican, Cuban, Salvadorian, and Dominican descent account for 82.4%.