The Incredible Shrinking Home-ownership Rate
The latest Census stats on homeownership show that just 67 percent of U.S. households own their home, down from a peak of 69 percent in 2007. That brings the share of homeowners back down to its level seven years ago.
The nation actually has a few more homeowners than it did last year – just over 75 million -- because the population overall is growing. But foreclosures have pushed millions of families out of their homes in the last two years, and with it their chance to live the American Dream.
Those numbers alone don't tell the whole story, though. Some segments of the nation are losing ground faster than others.
Specifically, the ownership rate for black-headed households is dropping the fastest, according to a recent study for the Pew Center for Hispanic Studies. Ownership rates have declined twice as much for black households as they have for white ones, since peaking in 2004.
While we're time-traveling back to 2003, it's worth remembering that it wasn't just the year when then-President George W. Bush declared "Mission Accomplished" in Iraq. Bush also hit the road to promote what his administration called "The Blueprint for the American Dream." The president had a lofty goal: "to increase minority homeownership by 5.5 million by the end of the decade."
Bush traveled the country to held hold events celebrating new homeowners. I interviewed one of those homebuyers for my book – Jorge Sotelo of Phoenix. The sad truth was that Sotelo ended up being a homeowner in name only, because like many homeowners he and his wife refinanced their mortgage to take cash back out. When the Phoenix bubble popped, they owed more than the home was worth, and were stuck with a high interest rate.
This was the first time anyone in Washington had explicitly set a target for boosting homeownership for people of specific racial groups, and the 5.5 million number was a big one - a whopping 50 percent increase. Of the 22 million black and Hispanic-headed households in 2000, roughly 10.4 million of them were already homeowners. Another 4.2 million lived in poverty. But as for the rest, Bush wanted to sign up three out of every four black and Hispanic renters to be homeowners.
Not only did the Bush blueprint fall far short of that goal; those who did get mortgages were much more likely to end up with risky subprime loans than other borrowers, according to federal data, and that increases the likelihood they'll go into foreclosure.
The foreclosure crisis has affected homeowners from every background and walk of life, but make no mistake - it does discriminate. Black homeowners have suffered more than their share of the pain.