WASHINGTON, D.C. – May 11, 2011 – (RealEstateRama) — According to new data released by the National Association of Home Builders (NAHB), stark contrasts exist inhousing affordability between major races and ethnic groups across the United States. The NAHB’s quarterly index, the NAHB/Wells Fargo Housing Opportunity Index (HOI), which measures housing affordability in metropolitan areas nationwide, was broken down for the first time in its history to analyze the differences in income and housing affordability in 2010 across five different races/ethnic groups.The report examined median incomes and housing affordability for Whites, Blacks, Hispanics, Asians and American Indians/Alaska Natives. The HOI for all races/ethnic groups combined was 72.8 in 2010, meaning that 72.8 percent of all homes sold in the U.S. last year were affordable to families earning the national median income of $64,400.
In comparison, median family income was $69,000 for Whites, $42,300 for Blacks, $44,100 for Hispanics, $80,500 for Asians, and $43,200 for American Indians/Alaska Natives. Thus, 80.3 percent of homes sold in 2010 were affordable to White families earning the group’s median income, compared to 53.0 percent for Blacks, 51.0 percent for Hispanics, 76.4 for Asians, and 58.7 for American Indian/Alaska Natives.
“By breaking down the HOI by race and ethnicity, we have an even more accurate picture of housing affordability,” said NAHB chairman Bob Nielsen, a home builder from Reno, Nev. “Builders have generally known that their efforts to build affordable housing were especially important to minorities in their communities, and this new report helps confirm that.”
Affordability disparities were generally quite apparent in the most populous metropolitan areas. In the New York-White Plains-Wayne, N.Y.-N.J. metropolitan division, for example, 46.1 percent of all homes sold in 2010 were affordable to White families earning the group’s median income. In comparison, only 13.4 percent and 8.8 percent of homes sold in this division were affordable for Black and Hispanic families respectively.
Among large metro areas, the HOI for Blacks was higher than that for Whites in only four: Rockingham County-Strafford County, N.H.; McAllen-Edinburg-Mission, Texas; Boulder, Colo.; and Olympia, Wash. The HOI for Hispanics was below the HOI for Whites in every case analyzed.
“Previously, we have only computed a single, global HOI, either for a particular metropolitan area, or for the nation as a whole,” said NAHB chief economist David Crowe. “However, it was evident that affordability differences are dramatic and persistent across racial and ethnic lines. The NAHB/Wells Fargo HOI methodology is a precise way to demonstrate these differences. Policy makers and elected officials may want to consider the differential HOIs for particular minority groups when contemplating policies that would increase home prices or otherwise impact the affordability of housing.”
To view the full report, please go to: www.nahb.org/hoibyrace.
