Black homeownership down to nearly 41% – and housing values down

The two largest minority groups in the United States are headed in different directions regarding homeownership:

While Hispanic homeownership rate is on the rise, the black homeownership rate has fallen 8.6 percentage points since its peak in 2004, hitting its lowest level on record in the first quarter of this year, according to census data.

This divergence marks the first time in more than two decades that Hispanics and blacks, the two largest racial or ethnic minorities in the U.S., are no longer following the same path when it comes to owning homes.

Analysts say black communities have struggled to recover financially since the housing crisis, which has kept homeownership out of reach. A decades long legacy of housing segregation has also made many would-be black buyers wary of returning to the market after losing their homes…

Homes in neighborhoods with a high concentration of white borrowers on average have seen their homes appreciate 3% from 2006 through 2017, according to the study. However, homes in neighborhoods with a concentration of black borrowers on average are worth 6% less than they were in 2006. High-income black borrowers have concentrated in neighborhoods where homes have lost 2% of their value, compared with white borrowers, who have concentrated in neighborhoods where homes have appreciated 5%.

According to the first quarter homeownership rates reported by the Census Bureau: whites have a rate of 73.2%, Hispanics are at 47.4%, and blacks are at 41.1%. These are off from peaks of 76.0% for whites in 2006, 50.1% for Hispanics, and 48.6% for blacks in 2006.

This is a contributor to inequality that gets relatively little attention. If homeownership rates are low for a particular group, not only does that mean a different present experience (renting versus owning), it has significant long-term consequences for building wealth. When whole neighborhoods have relatively low homeownership rates plus the properties there do not appreciate much, the effects can last decades.

Where are the 2020 presidential candidates in discussing homeownership as an issue Americans care about?

Patterns in racial/ethnic change in Chicago area counties 2010-2018

Recently released Census data at the county level shows the shift toward larger non-white populations in the Chicago area:

The Chicago Tribune article also points out a few of the notable patterns:

The six suburban counties gained a total of 14,857 non-Hispanic black residents from 2010 to 2018, most of them in Will and DuPage, the new census data shows.

Cook County, meanwhile, lost 75,081 black residents over the same time period. Black residents’ share of the county population decreased the most of any racial group in the last eight years…

In each of the six suburbs surrounding Cook, non-white Asian residents grew by at least 13% since 2010. DuPage County grew by the most people, with an increase of 21,960 Asian residents in that time.

I’ll throw in three more patterns I see in the table:

  1. The further out counties, the more exurban locations (Kendall and McHenry Counties) have much higher proportions of white residents. It will be interesting to see how these change in the coming decades. Not only are those locations farther from Chicago, they also have fewer historic industrial suburbs (like Joliet in Will County and Elgin in Kane County) that attracted more non-white residents.
  2. In all of the six counties, Hispanics account for larger proportions of the overall population than black residents. Whether this translates into political representation or status within the region is debatable.
  3. The Asian population is more concentrated as a proportion in some counties – DuPage, Cook, and Lake – compared to others.

Repealing a suburb’s English language resolution amid demographic change

The Chicago suburb of Carpentersville passed a resolution in 2007 saying English was the official language. The suburb continued to change and now officials have repealed the resolution:

Local officials say the English resolution caused nothing but controversy, and that progress came instead from targeting troublemakers, not Spanish speakers. Now, as one of the most diverse communities in the Chicago area, leaders hope to put the controversy behind them.

There’s also the demographic and political reality that Hispanics now account for slightly more than 50 percent of Carpentersville’s population of about 38,000, up from about 40 percent when the language measure was passed. Whites now make up about a third of the local populace, with most of the rest African- or Asian-American…

Still, it’s a touchy subject. When asked about the change in local law, Village President John Skillman, a lifelong resident, downplayed it. He said village documents and meetings will continue to be in English, and emphasized that the resolution made no concrete changes in the first place…

At the same time, efforts have been made to reach across ethnic boundaries. Last year, in addition to its Fourth of July fireworks, the village held a Mexican Independence Day celebration, and this year, its first Cinco de Mayo festival.

It is a relatively quick turnaround from a set of white candidates running for office and getting enough votes to join the Village Board and passing this resolution (and other measures aimed at undocumented immigrants) to repealing that same resolution eleven years later. At the least, it could suggest there is power of being part of local government: in a suburb of roughly 38,000 people, it may not take much to run for local office and campaign for particular issues. Regardless of what side of a political issue a resident is on, running for local office can make a difference.

The rest of the article hints at ways the suburb has come to terms with an increasing Latino population: Latino businesses in town, addressing gang activity, local festivals, and whether residents experienced discrimination. But, there is a lot more that could be addressed here. Did such a resolution significantly change day to day life? (The article suggests no.) How much do white, Latino, and black residents interact and participate in each other’s social networks? How does this play out in certain civic institutions like schools, religious groups, and community organizations? Resolutions or ordinances can certainly have a symbolic effect but there are a number of layers to community life and interactions in a suburb like Carpentersville.

(Side note: this is an apropos follow-up to yesterday’s post about how many Americans speak a language other than English at home. This affects more than just home life.)

How Census questions muddle race and ethnicity for Latinos

Sociologist Richard Alba explains how the Census does not accurately capture racial and ethnic change:

Sticking with the two-question format means that the great majority of young people with mixed Hispanic and white origins will be categorized only as Hispanic — and therefore as “nonwhite,” in census terminology. This classification will often contradict how they perceive and experience their identity, and how they’re treated by the world around them.

And it is sociological nonsense. A growing body of data reveals that individuals from mixed families look more like whites than they do like minorities — except for those who are partly black. The exception demonstrates, it should be emphasized, the persistent and severe racism that confronts Americans with visible African heritage.

 

And these measurements then affect projections for the future as well as political reactions:

And classifying those from mixed Hispanic and white families as “nonwhites” results in Census Bureau population projections of a majority-minority society by the mid-2040s. But such projections are grossly misleading because of the binary thinking that undergirds them and the misclassification of individuals who are partly white and partly minority…

In the 2016 presidential election, according to research Michael Tesler has reported here at The Monkey Cage, President Trump appears to have gained many votes from whites because of their anxiety about a rapidly changing society that would soon leave them as part of a minority.

At the least, we should keep in mind that racial and ethnic definitions can and do change over time due to a variety of factors: understandings within particular groups (self-understanding), understandings from other groups in society (pressures from the outside, particularly dominant groups), and how race and ethnicity are measured.

This could also raise questions about forecasts for the future of society – especially decades out. On one hand, we want to be able to prepare for changes and trends. On the other hand, demographic trends and shifts in behaviors and attitudes are not set in stone. Both researchers and leaders need to be flexible – or in terms of one of the current buzzwords, resilient  – enough to adapt.

“5 Reasons That Hispanic Homeownership Will Define Housing’s Future”

Where will the housing market turn in the near future? A new report suggests a move toward Latinos:

1. Hispanic Homeownership – Since 2000, the number of Hispanic owner households has increased from 4.242 million to 6.810 million, a rise of 60.54 percent; in just the last four years, in fact, Hispanic owner households have risen 614,000.

2. Hispanic Households – When we extend our parameters to overall households, the numbers are even more stunning. In 2014, the number of Hispanic households grew by 320,000, or 40 percent of total U.S. household growth.

3. The Hispanic Population – Since 1970, the Hispanic population has increased by 592 percent. No, that is not a typo! Even more, the Hispanic population is expected to reach 120 million by 2050, more than double what it is today.

4. Hispanics in the Labor Force – Thus far in the new millennium, Hispanics have accounted for 65 percent of the growth in the U.S. labor force, and every year, one million U.S.-born Latinos enter adulthood; with numbers like that, it’s no surprise that Hispanic purchasing power is $1.5 trillion, and is projected to grow to $2.0 trillion by 2020 (that’s an increase of $500 billion!).

5. Hispanics in Housing – Sixty-five percent of top agents NAHREP surveyed expected 2015 to be a “breakout year” for Hispanic homeownership, but NAHREP’s report pulled no punches on the considerable barriers that remain for homebuyers, among them a lack of affordable housing, competition from cash investors and tight lending standards – problems will have to be overcome before homeownership can truly take off.

Reasons #2-4 involve demographics: an increasing population leading to more households and workers. Reasons #1 and 5 address more Hispanics getting involved in the housing market: an increasing number of owners, optimism from realtors, and factors limiting even more Hispanics from owning homes.

The demographics are suggestive but the evidence in reasons #1 and 5 is limited. Census figures from the last quarter of 2014 suggest there is still a long ways to go: the homeownership rate for non-Hispanic white alones was 72.3% but only 44.5% for Hispanic (of any race) and 42.1% for Black alone. A growing population and jobs alone are not enough; homeownership often involves consistently good jobs and wealth as well as access to capital and housing at cheaper levels of the housing market where homeowners can get a start.

Growing Latino populations in American cities

Latinos constitute a growing share of American urban populations, raising implications for future political races:

While many cities are experiencing an influx of young whites, those gains are more than offset by the continuing exodus of working- and middle-class whites. The result is a net decline nationwide of the white share of city populations.

Hispanic ascendance is apparent in both cities and suburbs, increasing the likelihood of the election of Latinos to local, state and federal office.

Over time, blacks stand to lose leverage. Cities have been a crucial base of power for African-American politicians. Insofar as the black population becomes diffuse, black leaders will have to grapple with a decline in black-majority districts, especially city council districts, in cities with declining black populations…

Frey pointed toward the rapidly increasing strength of the Latino vote in the 100 largest metropolitan areas. Between 1990 and 2010, the percentage of city dwellers in such areas who are Hispanic grew to 26 percent from 17 percent; and the share of suburban residents who are Hispanic rose to 17 percent from 8 percent.

Some striking demographic changes that have potential consequences in areas like politics. The changes are numerous: an influx of younger, educated whites into city centers even as whites leave other areas of cities; an increase in the suburbanization of blacks; and growing Latino populations in both cities and suburbs. These changes may not quickly become apparent in the political landscape but should at least draw the attention of political operators. For example, is incumbent Mayor Rahm Emanuel really in danger in the run-off election? Given the demographic changes in large cities like Chicago, perhaps.

The historical emergence of the category Hispanic in the United States

A sociologist with a new book titled Making Hispanics discusses how the category came about:

How did this movement start?

It was the activists who first went to the Census Bureau and said, ‘You have got to create a category. You have got to distinguish us from whites.’ Up until that time, the Census Bureau mainly grouped Mexican Americans, Puerto Ricans and Cubans in the same category as Irish and Italian, and that became a real problem because it couldn’t show the government the poverty rates between Mexicans and whites. There was pushback on how large and how broad the category could be, but ultimately, a Hispanic category was established.

How was the category sold to Latin Americans?

The Census Bureau asked activists and the Spanish-language media to promote the category. The media created documentaries and commercials. There was even a Telethon where people called in, and were encouraged to identify as Hispanic on the Census form. We can see why the media executives were so happy and so quick to help the Census Bureau because, later on, it became in their interests to help grow that cooperation.

Why was that?

Until that time, Spanish-language media executives had been creating separate television stations and programming for Mexican Americans, Puerto Ricans and Cubans. Suddenly they were able to start using some of this broad Census data and go to advertisers like McDonald’s and Coca Cola and say, ‘Look, we’re a national Hispanic community and our consumer needs are different so invest in us and we will get you Hispanic consumer dollars.’ With that strategy, they were able to connect stations across the country, and over time, create a Spanish-language McDonald’s commercial that could broadcast to a national audience…

Weren’t there enough Mexican Americans to warrant their own category?

In the 1970s, this was fine if you wanted to capture the California governor’s attention, but it wasn’t enough for capturing President Nixon or President Ford’s attention, and it certainly wasn’t enough for capturing the attention of East Coast politicians because many of them had never even met a Mexican. But when activists were able to cite the number of Cubans in Florida, Puerto Ricans in New York, Salvadorans in DC and Mexicans in the Southwest, and when they were able to argue that these groups were all connected and were all in need of resources for job training programs and bilingual education, then they were onto something. It was only then that activists could get federal attention – by making Latin American groups seem like part of a national constituency.

Interesting blend of an emerging presence in the United States, developing Census definitions, and new marketing and media opportunities. This is another reminder of the fluidity of racial and ethnic categories in the United States and the various influences shaping those categories.