Share of First-Time Black Homebuyers On the Rise MABA MassachusettsRealEstate FirstTimeHomeBuyers MaBuyerAgent

 Despite a recent nationwide fall in first-time purchaser rates, Black homebuyers have seen the most recovery. According to a recent Zillow poll, sixty two percent of Black homebuyers made their first purchase in 2024, a percentage that remained constant from the year before. Overall, first-time purchasers accounted for only forty four percent of the market, compared to fifty percent in 2023. After years of historical racial disparities such as redlining or low-balled appraisals, this comes as great news for the Black community as they celebrate Black History Month in February.

 The percentage of Black first-time buyers increased to fifty five percent in 2022 and reached a record sixty three percent in 2023, surpassing both the national trend and other racial groupings, following a precipitous decline from forty seven percent in 2019 to thirty five percent in 2021.

 “Despite affordability challenges, Black first-time home buyers are demonstrating a strong commitment to homeownership, a key driver of generational wealth,” said Orphe Divounguy, Senior Economist at Zillow. “While income disparities and saving difficulties continue to delay home buying for Black households, programs like down payment assistance, first-time buyer tax credits and flexible lending options have helped increase access.”

Black Homebuyers Pursuing & Attaining Homeownership

 Some Black renters now have more freedom to pursue property in more affordable areas thanks to the growth of remote work. Black renters are twenty nine percent more likely than other renters to be at a tipping point where working remotely could make homeownership possible, according to Zillow data.

 However, in many metropolitan regions, high housing costs and stringent building codes restrict the options available to many buyers nationwide, disproportionately affecting lower-income households, especially Black and other color households. Price increases are frequently caused by supply shortages in these places, and even fewer listings are within the means of the average Black household in markets with harsher building codes.

 The monthly housing burden in relation to household income is a crucial indicator of housing affordability. The biggest obstacles are faced by Black households, whose median income of $54,896 is significantly less than the $95,213 required to purchase a typical U.S. home in 2024 without incurring cost-burden (spending more than thirty percent of income on housing).

 Thus, the average Black household can only afford an estimated seventeen point six percent of listings, while Hispanic households can afford twenty eight point two percent, White households can afford thirty seven point nine percent, and Asian households can afford fifty six point eight percent, highlighting ongoing disparities in U.S. homeownership.

Southeast Metro Boasts Most Affordable Market for Black Households

So, where is the city where Black homebuyers can find the easiest affordability?

Hint: This metro also boasts a renowned river, monument and a baseball team.

As some may have guessed by the photograph or hint, the most reasonably priced housing market for average Black households is St. Louis. GO CARDINALS!

With thirty point three percent of listings within reach in 2024, the Mound City gives the typical Black homebuyer, or those earning the median income, a chance to pursue homeownership.

Top Ten Most Affordable Metros for Black Households

1. St. Louis (thirty point three percent)
2. Birmingham (twenty nine point five percent)
3. Memphis at (twenty nine percent)
4. Detroit (twenty eight point six percent)
5. Baltimore (twenty five point eight percent)
6. Pittsburgh (twenty three point seven percent)
7. Cleveland (twenty two point eight percent)
8. Indianapolis (twenty two percent)
9. Atlanta (nineteen point two percent)
10. Oklahoma City (eighteen point eight percent)

 On the other hand, the West Coast—which includes major California metro areas and Seattle has the least affordable markets for prospective Black homebuyers. Additionally, throughout the pandemic, more Black people acquired homes. Despite the difficulties with cost, a growing percentage of Black buyers purchased their first home, indicating that Black households have not given up on becoming homeowners.

 Black homeownership rose higher than White homeownership in 2024 compared to 2019, even though the percentage of home listings that were within the median earner’s price range fell more sharply. The percentage rise in homeownership was only larger among Hispanic households. In conclusion, although financial and racial barriers still exist, Black first-time homebuyers are propelling increases in homeownership.

To read the full report, including more data, charts, and methodology, click here.

The post Share of First-Time Black Homebuyers On the Rise first appeared on The MortgagePoint.

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