The Latino Home Front Growing Population Needs More Help to Realize Dream

LOS ANGLES (Daily News) August 8, 2004 - The increasing Latino population, expected to account for 31 percent of U.S. household growth this decade, aspires to homeownership, but more outreach programs are needed to maximize this market's potential, said a report released Wednesday.

By 2010 an estimated 1.5 million Latino households will have bought homes, but more aggressive real estate industry programs, including bilingual ones, could reach an additional 700,000 families, said the report from the Tomas Rivera Policy Institute at the University of Southern California.

The report, "El Sueno de su Casa: the Homeownership Potential for Mexican-Heritage Families," also said that 84 percent of Latino renters want to buy a house and that 55 percent plan on doing so in the next five years.

The report, funded by mortgage giant Freddie Mac and surveying 1,400 Latino families in Los Angeles, Atlanta and Houston, noted that Latino families wanting to buy a home face several hurdles, especially getting accurate information about qualifying for a mortgage.

For example, 64 percent of the potential buyers lacked familiarity with the mortgage process, 53 percent said it's difficult to save for a down payment and a like amount had trouble finding a trustworthy adviser.

"To a certain extent prospective buyers should take the initiative and at the same time real estate professionals and local government should take the initiative to find ways to reach out to them and help them realize their piece of the American dream," said Jongho Lee, senior research associate at the institute and the report's primary author.

When it came to selecting someone whose advice could be trusted, 38 percent of respondents selected real-estate professionals, but 33 percent said they would get information from family, friends or colleagues.

Economics are also an obstacle, especially in areas like Los Angeles where affordability is heading down to record-low levels.

Of the respondents who want to own but are unlikely to buy within the next five years, just 38 percent reported incomes over $35,000 annually, 52 percent had bank accounts and 50 percent credit cards.

The study did not identify the number of programs that are already in place for Latino and other minority buyers, Lee said.

But there are numerous ones in the marketplace. Countrywide Financial Corp. has begun an advertising campaign targeted at the Latino market and some Web sites, like the Federal Department of Housing and Urban Development, Freddie Mac and Bank of America, are available in Spanish.

Bank of America spokeswoman Julie Davis said that the company has a Spanish-speaking staff in its banking center and loan processing facilities to work with Latino customers. And it partners with organizations like the National Association of Hispanic Real Estate Professionals and the National Council of La Raza.

The bank also offers home-buying workshops in Spanish, she said.

"A lot of what we do is work with them to provide information on getting ready to buy a home," she said.

The California Association of Realtors also takes a similar approach. Later this month the Los Angeles-based trade group, Freddie Mac and several other organizations will announce the California Latino Homeownership Initiative that focuses on home- buying education.

The association also provides its members with buyers and sellers guides in Spanish and an English/Spanish glossary of real estate terms. Agents provide them for free to their clients.

"We are aware there is a problem and more outreach needs to be done," said Carmen M. Petrinca, the organization's membership development manager.

REACHING OUT

Here are some recommendations for improving homeownership among Latinos.

--Informational home-buying programs

--Outreach by industry professionals

--Bilingual information

--Financial literacy programs

--Innovative mortgage products

--Alternative housing solutions, such as multifamily units.

Source: Tomas Rivera Policy Institute