Jennifer Korn: For Latinos, Owning a Home is Central to the American Dream

I will never forget my abuelita when I told her.

I had never seen her that proud -- not even the day I graduated from college, nor the day I told her I was going to work at the White House for the President of the United States.

This time her joy was all-consuming.

You could tell in her voice the gratitude to the One above as she said: “¡Ay que bien, mija!”

And so I knew that was the day that I reached the American Dream. It was the day we bought our first home.

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For Hispanics, owning a home is a source of pride like no other.

It is a sure sign of accomplishment, and a reward for years of hard work and sacrifice.

As shown in Fannie Mae’s quarterly National Housing Survey, Latinos are more motivated to buy a home than the general population. When asked for a major reason to buy, 56 percent of Hispanics said it is a symbol of success or achievement, compared to 32 percent of all Americans.

I am reminded of both my abuelita’s happiness and the sad reality that Hispanics face in regard to the housing market.

Today, a greater number of Hispanics are renters compared to the national average. The biggest impediments to closing the home ownership gap are lower incomes and higher unemployment.

According to the Bureau of Labor Statistics, in the first quarter of 2012, Hispanics earned 74 cents to the dollar compared to the average American worker.

In fact, since President Barack Obama took office, the weekly wages of Hispanics have grown at a slower rate than the average U.S. worker. This unfortunate truth and the fact that Hispanics face an 11 percent unemployment rate – over 30 percent higher than the national rate of 8.2 percent - make the dream of home ownership seem unattainable.

It is highly unlikely that the 23 million unemployed Americans and the six million who have simply given up looking for a job will take up a mortgage or refinance.

Similarly, those who lose their jobs or whose incomes don’t rise, will most likely not be able to stay current on their mortgage payments while also facing high prices and rising healthcare premiums.

Recent signs, like slowing foreclosure rates, have shown the housing market is nearing bottom, yet the economic uncertainty exposes us to the risk of these numbers increasing again.

Upon taking office, Obama promised that his housing initiative would help between seven and nine million families avoid foreclosure.

But the limited scope and poor management of the President’s two main foreclosure aid programs - HAMP and HARP - have resulted in yet another broken Obama promise. After three years, only about two million Americans faced with foreclosure have been helped by the White House’s policies.

In at least three states that are considered to be in play in the November elections, and that have significant Hispanic populations, voters have rejected Obama’s housing policies. In Nevada, the state hardest hit by the foreclosure crisis, 54 percent of voters disapprove of the President’s policies; the same is true for 50 percent of Floridians and 46 percent of North Carolinians.   

Homeownership has a direct and real impact on economic development. The current housing market is yet another sign of a jobless economic recovery. Despite historically low interest rates and high affordability, Americans’ concerns about employment and financial stability are keeping them on the sidelines of the housing market.

At this rate, and if we continue on a path of damaging economic policies (read: exponentially rising federal debt and looming tax increases), it is highly unlikely that by 2020, 80 percent of all new homeowners will be minority or immigrants, with Hispanics making up 40 percent of buyers, as experts predict.

Unfortunately for many, what was a true accomplishment in buying a home is now a burden for families.

I see the value of my own home and those of my neighbors decrease and face the inability to make any moves until the housing market recovers.

We have not seen true improvement in three years and no real answers under this administration. We are left wondering when the housing market will recover so that families can once again experience the joy and pride, like my abuelita, of owning part of the American Dream.

Jennifer S. Korn is Executive Director of the Hispanic Leadership Network. Previously, she served in President George W. Bush’s White House as Director of Hispanic Affairs.

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