Report examines homeownership gap among minority homebuyers
Glenn School Assistant Professor Stephanie Moulton and doctoral student Roy Heidelberg released a report examining affordable homeownership programs and the mobility patterns of low-income minority homebuyers. This study explored three key issues: mobility, neighborhood quality, and targeting of affordable lending programs to low-moderate income home buyers. The study was produced for the Ohio Housing Finance Agency which will use the findings to inform policy changes.
OHFA recently joined forces with the John Glenn School of Public Affairs to study issues and trends impacting the affordable housing industry. The work was done through the Office of Affordable Housing Research.
"This research from the John Glenn School of Public Affairs, and all research from OAHR will provide OHFA and our partners with the qualitative data we need to enhance our outreach of affordable mortgage programs to underserved neighborhoods," OHFA Executive Director Doug Garver said. "OHFA will continue to be an advocate for shaping policy and leading Ohio's affordable housing industry into the future."
Agency spokeswoman Arlyne Alston said of OAHR, which was created last December, "We launched the office for the specific reason of facilitating the formation and implementation of affordable housing policy and initiatives throughout the state."
The division intends to partner with colleges and universities going forward to collectively study housing issues in the state with the hope of influencing policy and law, she said.
The Closing the Gap report examines the state's affordable homeownership program specifically looking at mobility patterns and the neighborhood quality of low-income homebuyers, according the agency.
2007 U.S. Census Bureau data shows a homeownership rate of 75 percent for white households compared to 50 percent for black and Hispanic households. Attempts to correct the disparity, such as sub-prime and high-cost loans, exacerbated the problem with a quarter of subprime loans delinquent in the first quarter of 2009, according to OHFA.
Analyzing OHFA's First-Time Homebuyer Program, researchers asked the questions:
A large majority of both minority and non-minority families move within their own county when buying homes, although 12 percent more minority households stay nearby, according to the report.
Minority first-time homebuyers tend to purchase homes in areas with slightly better socioeconomic conditions than their previous renter tracts, and non-minority homebuyers are likely to purchase homes in neighborhoods with slightly worse economic conditions than their previous renter regions, the report shows.
"The preliminary results from this project demonstrate that affordable mortgage programs, like Ohio Housing's homebuyer programs, can help increase access to homeownership for minority households,” said Dr. Moulton. “Previous research suggests that as many as 40 percent of borrowers who received unaffordable, subprime loans would have been able to qualify for lower interest rate affordable mortgages. Through this research project, we can identify neighborhoods that were previously hit hard by unaffordable mortgages (like subprime loans), and ensure that such areas are provided with access to affordable mortgage products in the future."
