More Evidence that Blacks & Latinos Were Hit Harder by Housing Bust
IABG In The News
Compared to homeowners in white neighborhoods, those in African-American or Latino neighborhoods are more than twice as likely to owe more on their mortgage than the house is worth, according to a report released last week by the Woodstock Institute. Minority homeowners “have far less equity to use in an emergency,” said Spencer Cowan, Woodstock’s vice president for research, in a conference call Tuesday. The average homeowner in a community where at least 90 percent of residents are white has $108,000 in equity, Cowan said; those in predominantly Latino neighborhoods have about one-third that much—and those in African-American neighborhoods have one fifteenth of that amount.
Lucy Mullany of the Illinois Asset Building Group noted that almost 50 percent of nonwhite households in Illinois are “asset poor,” meaning that if their primary income source disappeared, they could live above the poverty level for three months. Fewer than 20 percent of white households are in that same situation. “Homes that have negative equity are most likely asset poor,” she said.