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People of color struggle to find housing

"We look at multigenerational homes."
Posted: 4:13 PM, May 10, 2022
Updated: 2022-05-10 21:28:47-04

BAKERSFIELD, Calif. (KERO) — Buying a home is a dream come true for many families, but the booming housing market has made that dream feel out of reach for some.

“They have to be able to move into a place that is affordable and affordable housing is a thing that is becoming a scarcity,” said Tino Diaz, Lender and Managing Director of America’s Homeowner Alliance.

It’s a problem potential home buyers are running into right now. Diaz explains there are simply not enough homes and, investors are also hungry to buy.

“The problem comes in with huge organizations, huge corporations, and funds that are explicitly to invest in these things. They come in and buy a lot of these single-family homes. For the purpose of renting, it back to people that want to own them.”

Diaz said although investors benefit the economy, this practice blocks out those who have worked hard to enter the competitive housing market.

He also said this often happens in the inner-city where the majority are people of color.

“When the loan becomes more expensive because of credit score, because of the loan level, those things add to the cost and then it takes you out of the market.”

Diaz said Latino communities tend to have lower credit scores, and usually, don’t qualify for a conventional loan because of it. High debt can also be a problem, but it’s important to factor in that those who approve them don’t have the cultural education to understand how Latino families come together to purchase.

In Kern County, The Valley Strong Credit Union recognizes some of these barriers and has programs to bridge that gap.

“We understand that in some families there are multigenerational families that live in the same home. We look at income for more than just the primary and secondary borrower like the husband and wife. We look at multigenerational homes that needs help in qualifying for the mortgage,” said Chuck Smith, Senior Vice President Chief Lending Officer with Valley Strong Credit Union.

Smith said they have bilingual programs in case language is a barrier. They can also refer people to down payment assistance programs offered through the state or county.

"If you look at the average home price in Kern County, interest rates have gone up by 2%. That means the payment on an average home in Kern County has increased by $453 since Dec 31. That means that the payment has gone from $1,830 a month to $2,370. So, you would need to make $94,800 a year instead of $73,200 a year at the end of the fourth quarter. That is just due to the increase in interest rates."

Despite those challenges, there is hope for potential buyers, including grants from the realtor's association.

“Closing costs assistance program and it allows them, if they are approved, gives them an additional $2,000 to apply towards their down payment and closing costs,” said Anna Albiar, 2022 President of Bakersfield Realtors’ Association.

It’s help like this that Diaz hopes will close the gap.

“Give the homebuyer a chance. We have to build up America because what we are doing with this, is weakening the social fabric of the country.”

23ABC In-Depth

One group of people making a strong push for becoming homeowners in California are Hispanics.

23ABC is taking an in-depth look at the top growing California markets for Hispanic home buyers.

According to the National Association of Hispanic Real Estate Professionals, from 2019 to 2021, these are the top housing markets in the state that have seen the most growth in Hispanic homeowners.

Riverside, San Bernardino and Ontario have seen the highest increase in new buyers with 88,051.

Next up is Los Angeles, Long Beach, and Anaheim with 55,358 new Hispanic homeowners added within that three-year timespan.

Third on the list is Fresno with their total increasing by 32,590.

Last on the list are San Jose, Sunnyvale and Santa Clara who have added 25,813 more Hispanic homeowners from 2019 to 2021.