Study underscores that factors not related to income are keeping the Black-white homeownership gap wide

• Racial mortgage affordability gap shrunk by more than a third since 2012
• Among all races, renting families able to afford a mortgage dropped by nearly half from 2021 to 2022
• White households own homes at a 73% rate, while Black households own at 44%, with over half of the top 50 metros showing a gap of 30 points or more

Seattle, WA – Feb. 23, 2024 (PRNewswire) The gap between the share of Black and white renting families that could comfortably afford a mortgage payment shrunk significantly during the pandemic, a new Zillow® report shows. Despite this progress, a notable homeownership gap and disproportionate rate of mortgage denials persists, suggesting that other barriers not related to income are also impeding Black families’ access to homeownership.

In 2022, approximately 38.6% of 138 million U.S. families¹ were not homeowners, according to the American Community Survey. Among those, more than 6.3 million families were considered “income mortgage-ready,”² meaning their income would allow for paying a typical mortgage payment in their area without being cost burdened. 

About 7.8% of Black non-home owning families were income-ready for a mortgage, compared to 12.5% of white families — a gap of 4.7 percentage points. While significant, the gap shrunk by more than one-third since 2012, when it stood at 7.9 percentage points.

“Despite the significant decline in mortgage affordability in the past two years, millions of families who do not own their home have the means to afford the largest share of a homeowner’s cost — the mortgage,” said Zillow Senior Economist Orphe Divounguy. “While some families may choose to rent, many are simply constrained. It’s crucial to recognize the existence of additional barriers beyond monthly cost, including access to funds for a down payment and closing costs — as well as other barriers that significantly contribute to mortgage denials, like insufficient credit scores and lack of access to credit. These barriers especially impact people of color.”

Still, among all races, the number of renting families able to afford a mortgage dropped to 6.3 million in 2022 from 12.9 million in 2021, as mortgage rates doubled. While higher mortgage rates and higher prices affected everyone, the median family income of renters rose more for Blacks than for whites since 2012. Regions where Black family incomes rose most generally experienced a greater decline in the racial mortgage readiness gap during the 2012 to 2022 period.

Detroit has the highest share (13.3%) of Black renting families earning enough income to comfortably afford a mortgage, followed by Memphis (12.8%), St. Louis (12.0%), Houston (11.6%) and Cleveland (11.2%). While home values are relatively lower in those communities and more Black families could afford the typical mortgage payment, access to homeownership remains a challenge.

Racial disparities in home values, homeownership rates and credit security
Even though the incomes of Black renting families rose faster during the pandemic, significant disparities persist in homeownership rates and home values between Black and white Americans. Nationally, white households owned homes at a much higher rate (73%) than Black households (44%), and the gap exceeded 30 percentage points in more than half of the country’s 50 largest metros in 2022.

Compounding the issue, the typical home owned by a white family is still worth far more than the typical home owned by a Black family. Although there has been incremental progress in narrowing the home value gap, it still exceeds 10 percentage points in 42 of the top 50 metro areas.

Discriminatory lending practices and higher denial rates for Black mortgage applicants, compounded by credit history issues, also pose challenges to housing equity. In 2022, Black applicants saw a 146% higher mortgage loan denial rate compared to white applicants, potentially hindering future generational wealth transfer. Credit history is the most common reason cited for these denials.

Initiatives aimed at things like enhancing access to down payment assistance and credit-building opportunities as well as implementing reforms in zoning, together with efforts to construct and preserve affordable housing in thriving communities, are vital.

Housing Inequalities by Race

Top 50 metros	Share of Black Families That Can Afford the Typical  Mortgage  Without Cost Burden(non owners)	Share of White Families That Can Afford the Typical Mortgage Without Cost Burden(non owners)	Share of Families That Can Afford the Typical  Mortgage Without Cost Burden (overall; all races)	Typical Home Value Gap: White vs. Black Households(in percentage points)	Homeownership Gap: White vs. Black Households(in percentage points)
United States	7.8 %	12.5 %	11.9 %	17.9 pp	28.9 pp
New York, NY	2.6 %	11.5 %	6.9 %	15.7 pp	33.0 pp
Los Angeles, CA	1.1 %	4.2 %	2.1 %	30.8 pp	25.7 pp
Chicago, IL	8.3 %	21.9 %	16.3 %	39.4 pp	33.5 pp
Dallas, TX	6.5 %	13.5 %	10.6 %	22.5 pp	30.2 pp
Houston, TX	11.6 %	19.3 %	13.7 %	22.9 pp	29.2 pp
Washington, DC	6.2 %	12.8 %	9.1 %	9.6 pp	19.1 pp
Philadelphia, PA	7.3 %	15.2 %	12.8 %	28.3 pp	27.1 pp
Miami, FL	4.7 %	13.1 %	7.2 %	22.2 pp	27.2 pp
Atlanta, GA	8.1 %	12.0 %	10.1 %	17.7 pp	24.3 pp
Boston, MA	2.8 %	5.4 %	4.8 %	18.1 pp	31.3 pp
Phoenix, AZ	4.2 %	5.5 %	4.4 %	14.2 pp	33.7 pp
San Francisco, CA	0.3 %	4.2 %	2.5 %	29.2 pp	29.2 pp
Riverside, CA	4.4 %	3.8 %	3.5 %	1.2 pp	30.6 pp
Detroit, MI	13.3 %	19.6 %	18.6 %	45.4 pp	34.0 pp
Seattle, WA	2.3 %	4.5 %	4.5 %	16.7 pp	34.3 pp
Minneapolis, MN	7.1 %	7.8 %	7.7 %	14.0 pp	46.0 pp
San Diego, CA	1.7 %	2.1 %	1.8 %	24.4 pp	32.3 pp
Tampa, FL	5.4 %	10.6 %	9.2 %	11.3 pp	27.0 pp
Denver, CO	1.3 %	4.2 %	3.6 %	12.7 pp	26.0 pp
Baltimore, MD	10.0 %	13.4 %	12.1 %	16.9 pp	30.8 pp
St. Louis, MO	12.0 %	17.6 %	17.3 %	44.7 pp	32.9 pp
Orlando, FL	6.3 %	10.0 %	7.6 %	13.2 pp	24.4 pp
Charlotte, NC	7.0 %	12.6 %	10.2 %	18.2 pp	31.5 pp
San Antonio, TX	4.9 %	16.6 %	10.1 %	10.5 pp	28.0 pp
Portland, OR	2.8 %	3.1 %	3.1 %	3.7 pp	38.9 pp
Sacramento, CA	2.1 %	3.8 %	3.2 %	5.8 pp	28.5 pp
Pittsburgh, PA	10.9 %	20.1 %	19.7 %	26.6 pp	39.9 pp
Cincinnati, OH	6.8 %	13.4 %	12.8 %	18.9 pp	39.5 pp
Austin, TX	6.4 %	6.3 %	5.5 %	22.0 pp	23.9 pp
Las Vegas, NV	3.6 %	7.5 %	5.4 %	5.1 pp	34.0 pp
Kansas City, MO	7.9 %	15.7 %	13.6 %	25.1 pp	32.5 pp
Columbus, OH	10.7 %	13.6 %	12.9 %	20.6 pp	36.2 pp
Indianapolis, IN	9.9 %	16.4 %	14.6 %	9.4 pp	33.3 pp
Cleveland, OH	11.2 %	23.8 %	19.1 %	40.6 pp	36.0 pp
San Jose, CA	0.0 %	3.5 %	1.9 %	17.6 pp	33.9 pp
Nashville, TN	3.0 %	7.3 %	6.3 %	14.4 pp	27.6 pp
Virginia Beach, VA	7.9 %	13.4 %	10.2 %	7.1 pp	27.9 pp
Providence, RI	2.3 %	5.1 %	4.8 %	10.1 pp	26.0 pp
Jacksonville, FL	9.5 %	9.9 %	9.9 %	21.1pp	27.2pp
Milwaukee, WI	5.3 %	12.5 %	10.4 %	38.2 pp	43.9 pp
Oklahoma City, OK	10.1 %	17.0 %	15.6 %	19.3 pp	33.9 pp
Raleigh, NC	3.5 %	8.1 %	6.6 %	15.5 pp	24.9 pp
Memphis, TN	12.8 %	20.8 %	16.2 %	32.7 pp	31.2 pp
Richmond, VA	9.0 %	12.1 %	12.2 %	13.0 pp	21.8 pp
Louisville, KY	9.3 %	14.5 %	13.3 %	29.4 pp	38.1 pp
New Orleans, LA	5.3 %	17.4 %	11.3 %	22.4 pp	26.4 pp
Salt Lake City, UT	5.8 %	3.6 %	3.0 %	7.5 pp	45.0 pp
Hartford, CT	9.4 %	13.5 %	15.7 %	23.4 pp	32.5 pp
Buffalo, NY	9.5 %	14.1 %	13.4 %	41.5 pp	33.1 pp
Birmingham, AL	9.9 %	11.1 %	11.5 %	46.4 pp	28.0 pp

About Zillow Group:
Zillow Group, Inc. (NASDAQ: Z and ZG) is reimagining real estate to make home a reality for more and more people. As the most visited real estate website in the United States, Zillow and its affiliates help people find and get the home they want by connecting them with digital solutions, great partners, and easier buying, selling, financing and renting experiences.

Zillow Group’s affiliates, subsidiaries and brands include Zillow®, Zillow Premier Agent®, Zillow Home Loans℠, Trulia®, Out East®, StreetEasy®, HotPads®, ShowingTime+℠, Spruce® and Follow Up Boss®.

All marks herein are owned by MFTB Holdco, Inc., a Zillow affiliate. Zillow Home Loans, LLC is an Equal Housing Lender, NMLS #10287 (www.nmlsconsumeraccess.org). © 2023 MFTB Holdco, Inc., a Zillow affiliate.

¹ For the purpose of this analysis, “family” refers to a related group within a household, as identified in the American Community Survey.

² This assumes a family can only afford a 3% down payment at the highest mortgage rate recorded each year based on applications submitted to the Freddie Mac from lenders across the country. A lower down payment implies higher monthly mortgage payments, raising the threshold income needed to be considered mortgage ready in this analysis.

SOURCE Zillow

Expensive, coastal and Western markets are already heating up as spring season approaches

• Well-priced homes are selling in 29 days, and that will shorten quickly as the shopping season opens.
• Mispriced inventory is lingering, however; an elevated 1 in 5 sellers are cutting prices to find buyers.
• New listings and total inventory are up slightly over last year, an encouraging sign for buyers.

Seattle, WA – Feb. 14, 2024 (PRNewswire) Both buyers and sellers should prepare for a competitive home shopping season this spring. The latest market report¹ from Zillow® shows that well-priced homes are being snapped up quickly, while those that linger on the market are seeing their asking prices cut.

“Some of the homes loitering on the market may just need the right buyer and digital curb appeal to cast a wider net, but many may be overpriced. There are slightly more homes for sale than this time last year, and there is still plenty of competition for well-priced houses,” said Zillow Chief Economist Skylar Olsen. “Buyers should prep their credit scores and sellers should prep their properties now — attractive listings are going pending in less than a month, and time on market will shrink in the weeks ahead.”

What buyers are seeing
Just over 1 in 5 houses on Zillow saw a price cut in January — that’s about equal to last year, but more common than in any of the five preceding years. Those cuts are bringing seller expectations more in line with the market conditions — the typical sold home was on the market for 29 days before going pending, while other homes lingered on the market for months, driving up the typical age of listings on Zillow to 72 days.

Shoppers already touring virtually and in person might be able to negotiate a deal on a house that’s been waiting just for them. But that’s likely not the case in places where median time on market for sold homes has dropped the most since last year: Las Vegas (down 32 days), Phoenix (30) and Seattle (28).

So where are the “deals” drying up and where are they plentiful? Price cuts are much less common than a year ago in expensive Western metros: Seattle, Las Vegas, Austin and San Jose.

Price cuts are most prevalent in Florida and Texas markets and in Phoenix. These are areas where total inventory is higher than before the pandemic — as in Austin and San Antonio — or where inventory declines are comparatively low.

There are a few more options available now than last year. Total inventory is up more than 3% from a year ago, while the flow of new listings to the market is up nearly 6%. January typically sees a significant jump in new inventory over December, and this year that monthly boost was 43%. Unfortunately — and in keeping with unimpressive Januaries over the past few years — that was a relatively small bump up.

What sellers are seeing
Sellers are still sitting pretty with record home equity. The typical U.S. home value is up nearly $100,000 since 2020, now standing at $344,159. Annual appreciation of 3.6% nationwide is fairly healthy, and only three of the 50 largest U.S. metros saw their home values fall over the year.

More than a quarter of homes sold for more than asking price in December, the most recent data available. That’s fewer than in the rate-fueled real estate rush of the early pandemic, but slightly more than in December 2022 and far more than before the pandemic, when less than 20% of homes sold over list price.

Metros where sellers are showing up much stronger than last year are San Diego, where new listings are up 28% annually, Miami (22%) and Riverside (20%).

What to expect in coming months
All this points to a relatively competitive home shopping season in which attractive listings are moving quickly. Demographic factors and a relatively strong economy mean vast numbers of millennials and baby boomers looking for houses, even while affordability is still extremely challenging.

Buyers should get their credit in order, talk to a loan officer to understand their budget, and search by monthly payment to make sure their search results stay within their budgets, regardless of mortgage rate swings. Relevant down payment assistance programs are on every Zillow listing.

For sellers, it’s important to work with an agent who understands local market conditions and will price their home correctly. Sellers can make their home stand out by upping its online curb appeal — Listing Showcase leads to more views, saves and shares on Zillow.

Metropolitan Area*	January Zillow Home Value Index (ZHVI) (Raw)	ZHVI Change, Year over Year (YoY)	Median Days to Pending	Share of Listings with a Price Cut	Share of Listings with a Price Cut, January 2020	Share of Homes Sold over List Price, December 2023	New Inventory Change YoY
United States	$344,159	3.6 %	29	21 %	17 %	26 %	5.8 %
New York, NY	$632,127	5.6 %	43	12 %	15 %	49 %	-6.3 %
Los Angeles, CA	$911,320	7.4 %	18	16 %	15 %	44 %	18.2 %
Chicago, IL	$302,595	6.5 %	19	18 %	22 %	31 %	-6.2 %
Dallas, TX	$367,702	0.5 %	35	27 %	22 %	18 %	18.2 %
Houston, TX	$301,680	0.5 %	42	24 %	23 %	14 %	2.4 %
Washington, DC	$540,052	3.7 %	9	17 %	16 %	34 %	-10.0 %
Philadelphia, PA	$344,822	7.0 %	16	20 %	20 %	37 %	-10.4 %
Miami, FL	$475,863	7.1 %	42	24 %	19 %	12 %	21.9 %
Atlanta, GA	$371,663	3.7 %	33	24 %	22 %	22 %	17.3 %
Boston, MA	$654,158	8.0 %	9	12 %	14 %	50 %	5.1 %
Phoenix, AZ	$447,681	2.8 %	29	31 %	21 %	16 %	14.5 %
San Francisco, CA	$1,100,538	1.7 %	14	14 %	10 %	48 %	15.3 %
Riverside, CA	$564,505	5.3 %	29	19 %	18 %	37 %	20.1 %
Detroit, MI	$237,389	5.7 %	19	19 %	21 %	34 %	-0.3 %
Seattle, WA	$700,072	3.2 %	9	16 %	13 %	29 %	2.0 %
Minneapolis, MN	$356,357	1.6 %	41	17 %	15 %	30 %	19.1 %
San Diego, CA	$905,384	9.6 %	13	18 %	17 %	41 %	27.7 %
Tampa, FL	$372,230	3.0 %	36	33 %	26 %	14 %	19.2 %
Denver, CO	$566,617	1.1 %	19	21 %	20 %	22 %	7.8 %
Baltimore, MD	$369,268	3.7 %	14	21 %	21 %	38 %	-6.1 %
St. Louis, MO	$239,192	5.6 %	12	20 %	17 %	34 %	-4.6 %
Orlando, FL	$388,255	3.5 %	36	27 %	23 %	13 %	18.1 %
Charlotte, NC	$370,079	3.7 %	21	22 %	21 %	28 %	9.5 %
San Antonio, TX	$282,784	-3.2 %	57	27 %	24 %	16 %	1.5 %
Portland, OR	$530,065	1.9 %	37	21 %	18 %	26 %	-8.2 %
Sacramento, CA	$560,040	2.5 %	17	19 %	16 %	33 %	19.7 %
Pittsburgh, PA	$202,375	4.8 %	28	23 %	19 %	25 %	-4.1 %
Cincinnati, OH	$268,878	5.8 %	12	23 %	22 %	26 %	-2.4 %
Austin, TX	$449,867	-6.2 %	72	21 %	18 %	10 %	-7.8 %
Las Vegas, NV	$409,233	3.1 %	27	20 %	22 %	18 %	10.8 %
Kansas City, MO	$290,499	5.2 %	13	20 %	17 %	30 %	-7.7 %
Columbus, OH	$299,276	6.0 %	10	24 %	21 %	31 %	1.9 %
Indianapolis, IN	$269,013	2.8 %	26	25 %	22 %	16 %	12.1 %
Cleveland, OH	$212,944	6.9 %	15	21 %	18 %	34 %	-6.8 %
San Jose, CA	$1,478,932	7.2 %	10	11 %	12 %	55 %	15.3 %
Nashville, TN	$427,168	1.0 %	40	26 %	19 %	13 %	-17.2 %
Virginia Beach, VA	$333,989	5.7 %	35	20 %	18 %	32 %	2.7 %
Providence, RI	$451,146	8.3 %	14	15 %	16 %	48 %	6.5 %
Jacksonville, FL	$350,296	0.4 %	46	28 %	24 %	13 %	12.6 %
Milwaukee, WI	$322,644	7.1 %	31	14 %	15 %	29 %	6.0 %
Oklahoma City, OK	$226,803	3.5 %	31	25 %	19 %	22 %	2.6 %
Raleigh, NC	$431,676	2.1 %	19	24 %	22 %	24 %	6.7 %
Memphis, TN	$231,624	0.5 %	38	22 %	15 %	16 %	-6.4 %
Richmond, VA	$350,927	4.8 %	10	18 %	19 %	39 %	3.0 %
Louisville, KY	$244,617	4.3 %	20	24 %	23 %	19 %	-5.2 %
New Orleans, LA	$232,211	-8.2 %	55	22 %	21 %	10 %	-3.6 %
Salt Lake City, UT	$524,480	0.9 %	31	25 %	18 %	23 %	10.2 %
Hartford, CT	$337,348	12.2 %	7	16 %	20 %	64 %	-5.8 %
Buffalo, NY	$243,920	6.9 %	17	14 %	17 %	64 %	-10.1 %
Birmingham, AL	$247,020	1.1 %	33	20 %	14 %	25 %	-0.3 %

*Table ordered by market size

¹ The Zillow® Real Estate Market Report is a monthly overview of the national and local real estate markets. The reports are compiled by Zillow Research. For more information, visit www.zillow.com/research.

About Zillow Group:
Zillow Group, Inc. (NASDAQ: Z and ZG) is reimagining real estate to make home a reality for more and more people. As the most visited real estate website in the United States, Zillow and its affiliates help people find and get the home they want by connecting them with digital solutions, dedicated partners and agents, and easier buying, selling, financing and renting experiences.

Zillow Group’s affiliates, subsidiaries and brands include Zillow®, Zillow Premier Agent®, Zillow Home Loans℠, Trulia®, Out East®, StreetEasy®, HotPads®, ShowingTime+℠, Spruce® and Follow Up Boss®.

All marks herein are owned by MFTB Holdco, Inc., a Zillow affiliate. Zillow Home Loans, LLC is an Equal Housing Lender, NMLS #10287 (www.nmlsconsumeraccess.org). © 2023 MFTB Holdco, Inc., a Zillow affiliate.

(ZFIN)

SOURCE Zillow

As the cost of independence rises, Zillow offers a fresh solution for those flying solo

• The “singles tax” increased this year, now standing at $7,110.
• Cohabitating renters collectively save $14,220 annually on average by living together, but that can be as much as $40,200 in New York City.
• Zillow users can now list and search for individual rooms for rent, reducing housing expenses by finding a roommate to share costs.

Seattle, WA – Feb. 12, 2024 (PRNewswire) Zillow’s latest findings reveal a steep “singles tax” that could dampen the spirits of solo dwellers. Renters braving the one-bedroom market on their own are now paying a premium of $7,110 per year to live alone, an increase of more than $100 from last year’s already staggering figure.

In New York City, where personal space comes at a premium, singles still shoulder the most significant burden in the country for the luxury of living alone. According to data from Zillow’s New York City brand StreetEasy, the additional annual cost for solo living has reached $20,100, a $600 increase from last year.

Conversely, cities like San Francisco, San Jose, Boston and Washington, D.C. have seen modest reductions in their singles tax. While these small declines provide a bit of financial breathing room, they don’t mitigate the broader affordability challenges in major cities.

“While some renters may envy their coupled-up friends for dodging the singles tax, solo renters enjoy perks that go beyond financial savings. There’s no arguing over which show to binge-watch next or disputes about whose turn it is to clean up after dinner,” said Emily McDonald, Zillow® rental trends expert. “Still, it’s crucial for renters to really dive into what living alone costs in their area and decide if the price tag is worth it.”

Zillow’s analysis also reveals that cohabitating renters across the country enjoy annual savings of $14,220 over their solo-dwelling counterparts. The financial benefits of living together becomes even more pronounced in pricier cities, with couples in New York City seeing potential savings of $40,200. This considerable sum could be used to help erase credit card debt, invest in a retirement fund or contribute to a down payment on a home.

For singles looking to dodge the singles tax, embracing the roommate route presents a popular solution to keeping housing costs in check. Zillow recently rolled out room listings, aimed at alleviating the financial strain of living alone. This new listing type offers users the flexibility to both find and offer individual rooms for rent, seamlessly bridging the gap for those seeking a more budget-friendly living arrangement.

About Zillow Group
Zillow Group, Inc. (NASDAQ: Z and ZG) is reimagining real estate to make home a reality for more and more people. As the most visited real estate website in the United States, Zillow and its affiliates help people find and get the home they want by connecting them with digital solutions, great partners, and easier buying, selling, financing and renting experiences.

Zillow Group’s affiliates, subsidiaries and brands include Zillow®, Zillow Premier Agent®, Zillow Home Loans℠, Trulia®, Out East®, StreetEasy®, HotPads®, ShowingTime+℠, Spruce® and Follow Up Boss®.

All marks herein are owned by MFTB Holdco, Inc., a Zillow affiliate. Zillow Home Loans, LLC is an Equal Housing Lender, NMLS #10287 (www.nmlsconsumeraccess.org). © 2023 MFTB Holdco, Inc., a Zillow affiliate.

(ZFIN)

SOURCE Zillow