June is National Homeownership Month. Homeownership has an almost mythical reputation in the United States – with the homeownership rate for the last fifty years hovering consistently around 63%. It represents not only a safe, decent, affordable place to live and raise a family but also an investment in that family’s future. The most accessible, reliable access to wealth for Americans has been the equity they build in the homes they own. It is home equity that many Americans use as collateral for small business loans, to pay college tuition, and to improve their property.
Today 60% of NC households make less than $50,000/yr, but only 35% of NC homeowners
As North Carolina recovers from the Great Recession, homeownership is even more important for the economic recovery of NC families. Peaking above 70% in 2005, homeownership rates fell across the state from 2009-13 to an historic low of 66% in 2014. Foreclosures and a lack of access to credit hit rural communities and communities of color hardest. And while prices have begun to rise in urban areas, many rural communities are saddled with housing markets that provide no equity for homeowners.
While NC’s homeownership rate has inched up and has exceeded the national average, many North Carolinians still lack the ability to own a home of their own. While households that make less than $50,000/yr make up 60% of NC households, they make up only 35% of NC homeowners. Those moderate income homeowners are also cost burdened, with almost 50% of them spending more than a third of their monthly income on their mortgages.
In addition to income, race and ethnic origin also play an outsized role in homeownership. While the homeownership rate is 75% for white households, it is only 50% for black households. Native American households have an even lower homeownership rate at 41%. And households that identify as of Hispanic origin have a rate of 31%. Even when incomes are held the same, homeownership remains out of reach.
The homeownership rate is 75% for white households, 50% for black households, 41% for Native American households, and 31% for households of Hispanic origin.
We still have a long way to go in NC to make sure there is access to capital for would be homeowners at every income level and of every racial/ethnic origin. National Homeownership Month is a good time to focus on that issue in your community. There are several questions you can ask to insure that your community is providing homeownership opportunities for all: Does your community have access to housing counseling and/or financial capability counseling to help households transition from renting to ownership? Does your local government provide funding for low income and first time homebuyers? Are there revitalization efforts in struggling neighborhoods or preservation efforts in gentrifying ones? Are there banks that make an effort to diversify and market a range of lending options? Local communities that are committed to homeownership see not only gains in housing stability but see educational gains for children and economic gains for the whole community.
You can help us provide leadership on homeownership in North Carolina by joining renewing your membership in the Coalition. We work every day to make sure policy makers, local governments and lenders understand the needs and opportunity for homeownership in NC. Join us!