With income inequality and a widening wealth gap dominating headlines worldwide, in the U.S. a group of Latino leaders have launched an initiative to combat both issues in Hispanic households over the next decade.
Latino families were the hardest hit during the 2008 recession — median household wealth among Latinos plunged by 58 percent from 2005 to 2011, according to the Pew Research Center, the biggest drop of any racial or ethnic group.
While the Latino jobless rate has fallen to the lowest number since the recession, rebuilding wealth in Latino families is an end game that requires a long term plan. On Tuesday, the nonprofit National Association of Real Estate Professionals (NAHREP) and other Latino leaders launched the Hispanic Wealth Project in the hopes of offering a blueprint to getting Latino families not only back on their feet, but to thrive.
The group, led by former U.S. Secretary of Housing and Urban Development Henry Cisneros, will chair an advisory group of business leaders, entrepreneurs and celebrities who will develop what they hope are remedies to help triple Hispanic household wealth over the next 10 years.
“Hispanics are a substantial and growing segment of our workforce and consumer base. The entire country benefits when the Hispanic community succeeds," said Henry Cisneros in a statement from NAHREP. “Now is the perfect time for a thoughtful and comprehensive effort to address this important issue.”
The so-called blueprint will focus on prioritizing the importance of Latino home ownership. According to NAHREP, two-thirds of the average net worth of Latino households lies within their home equity.
The Hispanic home ownership rate in the third quarter of 2013 was 48 percent, up from 46 percent in the second quarter, but well off a peak of 50 percent hit in 2008, according to the Census Bureau. The overall U.S. home ownership was 65 percent in the third quarter.
Some experts say an increase in the supply of homes from new construction of multi-family buildings and investors turning previously-owned homes into rental units should stem the tide of rising rents we’ve seen over the past five years.
The Hispanic Wealth Project will include a comprehensive report to be published later this year.
The report will include analysis of the "asset composition of Latino households, the impact of debt, the role of education, current access to government programs, small business formation trends, low wages and higher unemployment rates, assimilation and language," and more according to NAHREP.