Expanding homeownership opportunities for Latinos in Riverside County, by Ruby Frazier.

Expanding Homeownership opportunities for Latinos in Riverside County

By Ruby Frazier

California is well known for its ridiculously high housing prices. The affordability crisis is well documented and known to be a major problem affecting millions of the state’s residents. Additionally, it’s known that the affordability crisis stems from the state’s inability to produce more homes for more than a decade with many experts arguing that to bring the housing crisis and affordability issue to manageable levels, the state needs at least 3.5 million homes by 2025.

Obviously, the insufficient housing supply affects everyone. But studies prove that the more disadvantaged people are the minorities and marginalized communities and Hispanics and Asian Pacific Americans buys are largely affected by this.

Also, a known fact is that the Latino community in California is growing both economically and socially but even so, they are far less likely to become homeowners and a larger percentage spend a greater portion of their incomes on housing than all other residents of the state. The Latino community in California represents one of the fastest-growing ethnic groups and homeownership is the cornerstone for their survival. But many barriers have blocked housing development, especially in the areas where there are large percentages of Latinos who are squandering their ability to afford housing. In fact, only 29% of the Latino Households can afford a median-priced house in California two decades ago (1999) which was 8% lower than the state’s average. Fast forward to 2021, nationally, Latinos lag behind the non-Hispanic whites with a 26% gap. Statewide, only 44% of the Latinos are homeowners compared to 65% of the nonHispanic Whites. Other research suggests that Latinos are more likely to spend more than 50% of their incomes on housing costs than all other races combined.

EXPANDING HOMEOWNERSHIP OPPORTUNITIES FOR THE LATINOS

If we are to help Latinos in California, and more so in Riverside enjoy the full benefits of homeownership, then we need to first understand the genesis of this chronic problem.

There exists a chronic imbalance in the supply and demand, especially in the areas where Latinos are found large populations-primarily the Greater Los Angeles area where at least 40% of all residents are Latinos. In such an area you will find that increases in the prices of homes exceed the increases in incomes by a large margin, particularly for the Latinos.

Additionally, the lack of housing is shutting the opportunities for the first-time Latino buyers which means, many would-be buyers are stuck

and cannot move higher up the economic ladder. Higher rents, long commutes, and the denial of the economic benefits of homeownership are among the burdens placed on Californian Latinos because of the shortfall in housing supply.

Fortunately, all is not lost and there are some positive steps that can be taken to address some of these problems. First, we need to figure out how to reduce the regulatory and government-induced barriers to housing. If we can do this, the economic capability and resources will be availed to jumpstart housing construction that will add more housing inventory to the market, thus helping not just Latinos, but all Californians.

IT’S NOT JUST A ‘LATINO PROBLEM’ ANYMORE…

The housing crisis in California is affecting everyone and according to data by the California Department of Finance, the past decade has seen fewer homes constructed than half of what’s actually needed. The vacancy rates- one of the most important metrics to gauge the housing supply and demand presently are at an all-time low and the problem is, Latinos are the ones Remember, the Latino household has not kept pace with inflation and the Californian home values continue to escalate far more rapidly than inflation.

Because of the housing shortage, Latinos suffer severe overcrowding problems. For instance, in the Los AngelesLong Beach metropolitan Area, the overcrowding rate for the Latinos is three times greater than for homeowners as a whole. In the same Metro area, overcrowding for Latino renters is twice as high as for the general rental population.

Cinco De Mayo is fast approaching and I think Latinos would best celebrate knowing that their issues in housing are being addressed. In light of that, I would suggest the public and private sectors work together to find alternative In addition, the municipalities and government agencies need to regularly conduct a cost-benefit analysis of their regulatory and policy requirements that cut on the available land for residential construction.

Also, rewards and penalty systems work where local governments will be persuaded to allocate sufficient land to meet the housing needs. The state must also eliminate the financial disincentives that discourage municipalities from approving and encouraging residential developments.

More importantly, the state must reform its zoning, ordinances, residential density restrictions, and urban growth boundaries to respond to the current market needs.