House seekers across the country are feeling the effects of the booming market, but Black communities are still struggling to make gains in homeownership.
A new report by the National Association of Realtors looks at trends in homeownership for Black, white, Latino, and Asian communities. The Snapshot of Race and Home Buying in America found that the homeownership rate increased for communities across the board, yet the rate for Black homeowners rose by 1.4%, which is still lower than it was in 2010.
A local realtor said she has seen similar trends in Rochester. Tysharda Thomas is the co-owner of New 2 U Homes, and a co-chair for the Black Caucus of the Greater Rochester Association of Realtors.
Thomas said she services Black clients and many of them use grant programs which make it difficult to purchase a home in a competitive market.
“We know that there's a few grants that have been put in place this year for Black and Latin first-time homebuyers, but people are coming with cash, said Thomas. “We have grants, and we are going up against cash, it's almost cut and dry of how it's going to turn out.”
According to the recent national report, home buyers need to spend more of their budget on housing costs, due to costs significantly rising during the pandemic.
Thomas said home buyers are seeing this in Rochester too.
“What I'm seeing right now with this seller's market is of course, homes are selling anywhere between $50(thousand) and $100,000 over list price. I think I heard a couple weeks ago $200,000 over list price,” said Thomas.
According to the report about 31% of Black renters in New York state can afford the typical home.
Thomas said Black people often don’t pursue homeownership because they are unaware that it is attainable.
“When you're renting here in Rochester they want you to make three times the rent monthly and be able to have a certain credit score. All things that you would think would position you to buy a home,” said Thomas. “And people don't know that once you do that, that's half the battle.”
The data in the report also shows that Black communities have the highest denial rates for mortgages and refinancing loans.
Thomas says credit score and lack of capital are often barriers but there are programs being created to level the playing field for people of color.
“There are some programs that are coming out. If you put down a certain percentage, like more money, 20% down, which we don't always have, said Thomas. “But if you do that, you can compete with the cash offers.”
Thomas said that despite it being a seller's market, she encourages people to pursue homeownership because now is a good time for buyers to take advantage of low interest rates.
