The National Association of Real Estate Brokers (NAREB) is launching an initiative to increase the number of African American home owners by two million within the next five years.
In order to achieve this, NAREB is offering kick starting a number of educational campaigns aimed at helping to reduce fears about the home-buying process and preparing renters to become home owners, The Commercial Appeal reports.. In addition, the group is looking at ways to address the financial challenges of becoming a home owner.
NAREB used Compliance Technologies’ LendingPatters software to establish that in the city of Memphis, white applicants for home loans are 1.72 times more successful than black applicants. In addition, black applicants are denied a home loan 2.56 times more often than white applicants.
Throughout 2014, there were 8,646 mortgage applications from white people, of which 65.5 percent were successful. This compares to just 38 percent of successful applications among the 7,000 black mortgage applicants in the same year.
Black Americans have the lowest rate of home ownership out of all ethnic groups in the U.S. at just 41.9 percent, U.S. Census data shows. Unfortunately, that number has fallen every year since the last major housing crisis – in 2004, for example, black home ownership stood at 49.1 percent. Hispanics, in contrast, have a home ownership rate of 74 percent.
“We lost quite a bit of equity wealth. We need to rebuild it,’’ says Ron Cooper, a Los Angeles real estate broker and president of NAREB. “The message is that the pursuit of home ownership of black Americans is still a noble pursuit. The American dream is within our reach; we just got to reach for it.’’