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  • Writer's pictureThe San Juan Daily Star

For a growing number of Latinos, homebuying is a family affair

Danae and Ashley Vega’s home in San Bernardino, Calif., on Feb. 24, 2024. Many Latinos are becoming first-time and first-generation homeowners by pooling their family’s resources to buy as a unit. (Beth Coller/The New York Times)

By Colette Coleman

Whenever Danae Vega, 33, took a shower in her Southern California home, it was an ordeal. The pipes were broken, so the water didn’t drain. Each time, she would have to ask her younger brothers to manually remove the water so the next person in the family of eight could take a shower. Demanding that the landlord repair the pipes was not an option. “When we would tell the owner to fix it, he would always threaten us: ‘If I fix it, I’m going to have to include this in raising the rent,’” she said.

Even without installing new pipes, he increased it, though, and often: Vega cited repeated substantial hikes in 2022 and 2023. Needing to leave that situation and not wanting to end up in a similar one, she and her two sisters, three brothers, and parents decided to buy a home.

The Vegas are among a growing number of Latinos becoming homeowners in the United States. From 2019 to 2022, the Hispanic homeownership rate increased more than that of any other demographic group, said Jung Hyun Choi, a principal research associate at the Urban Institute, a think tank. A study by the Urban Institute projects that between 2020 and 2040, 70% of net new homeowners will be Hispanic.

For many Latinos, including the Vegas, first-time homeownership in a time of low inventory and high interest rates is possible because they are buying as a family, combining incomes and relying on members with the best credit to take the lead.

And many Latinos are already living in multigenerational homes. Analyzing data from the American Community Survey, Choi found that 63% of Latino households are multigenerational, compared with about 57% of Asian American households and less than 50% of Black or white households.

Oralia Herrera, a broker in the Chicago area who founded a local chapter of the National Association of Hispanic Real Estate Professionals, said that over her 33 years in real estate, multigenerational buying had been cyclical, and is returning now because of the housing market’s challenges.

“When I first began my career, I saw a lot of that,” she said. “It was the first time that Latinos in my community were buying, and it was almost a given that we would have to put two to three names on that contract in order to get the loan.” She explained that there was a subsequent period of “better jobs, stability,” and “better earnings,” which led to individual home buying. But now, because of high prices, “we’re back to where I started,” Herrera said.

And not just in the Chicago market, according to NAHREP: In a 2022 study, 19 out of 25 top real estate practitioners from around the country “reported an increase in co-borrowing, particularly among family members.”

There are a number of ways family members can become homeowners as a unit. In some cases, all family members who contribute financially are borrowers and legal owners. In other cases, some family members are involved unofficially if their borrowing profiles may lead to less preferable loan terms.

Vega said her parents, who are originally from Michoacán, Mexico, tried to buy a house multiple times, but it never worked out. In one instance, she recalled, friends talked them out of it: “They’d be saying: ‘Why are you going to get it? So much responsibility.’” Another time, issues with credit stood in their way, Vega said.

So in March 2023, Vega and her 28-year-old sister Ashley were the ones to purchase the $331,000 three-bedroom, two-bathroom house on half an acre in San Bernardino County that the whole family now lives in.

The Vega sisters’ position — as not just first-time homeowners, but first-generation homeowners — is common for new Hispanic buyers, according to Laura Arce, senior vice president for economic initiatives at UnidosUS, a civil rights organization. Latinos, she said, are “the largest share of the new homebuyers coming forward.”

In 1994, the Hispanic homeownership rate was 40.3%. At the end of 2023, it was 49.8%. The increase is especially notable because over those decades, the Hispanic population in the United States nearly tripled — to 62.1 million in 2020, from 22.4 million in 1990.

Though Danae and Ashley Vega are the only ones on the deed, they see their home as a communal asset. The whole family helped in the property search, and everyone contributes, whether financially or domestically. “My dad has already built a chicken coop outside,” Danae said. “My mom already decorated the whole living room and the kitchen. It doesn’t feel like it’s just my house or my sister’s house. It feels like it’s all of ours.”

In many cases of multigenerational buying, the home is not only thought of as belonging to members across generations — it legally does, too. Alexandra García, 21, and her father, Rosalio García, 52, together bought their first home last year in Las Vegas. They were eager to own because renting felt like a waste of money. “In the 10 years that I was living at the previous home renting, I practically threw more than $100,000 in the garbage,” Rosalio García said in Spanish.

For Rosalio García, an auto mechanic who immigrated from Nayarit, Mexico, over 30 years ago, homeownership was inaccessible largely because he had no credit history. This lack of established credit is common among Hispanic immigrants, according to Vicky Garcia, the chief executive of the Latino Community Credit Union. “In Latin America, having credit is a bad thing,” said Vicky Garcia, who is originally from Colombia. “If you don’t need a credit card because you have enough cash to live on, you don’t get a credit card.” Others may hold off because they do not understand how the system works or feel intimidated by commercial banks, she explained.

Unlike her father, Alexandra García got credit cards from retail stores starting at age 18, followed by cards from big banks, but her job at a TJ Maxx warehouse did not make her feel “financially stable” enough to buy a home on her own. So she added her father as an authorized user on her credit cards, which gave him credit history, and in July they bought the $375,000 1,600-square-foot, three-bedroom, two-bathroom home that they live in with Alexandra García’s twin sister and her mother, Rosalio García’s wife. Both Alexandra and Rosalio García are on the home deed and the loan.

For Alexandra, sharing her credit and helping her family purchase their first home was an honor. “Our parents, they’ve done so much for us,” she said. “There’s something that we could do for them to give them that favor back.”

Alejandro Rodriguez, 25, in Mesquite, Texas, also relished being able to help his 48-year-old mother, a Mexican immigrant, achieve her “American dream,” after years of moving around in rentals during his childhood. A few months ago, he co-signed and closed on the four-bedroom, two-bathroom, 1,500-square-foot home that his mother and brothers live in. “I was on the brink of tears, I guess you could say, just because it’s been a dream of my mom to own a house, and I know how much she sacrificed for us,” he said. “It was a great feeling.”

Credit is not the only barrier to homeownership that is driving multigenerational buying. With today’s high home prices, many families find it advantageous, and often necessary, to combine incomes to qualify for a loan.

Family members who buy together as

first-time homeowners do often go on to buy individually later, according to Nora Aguirre, the 2024 president of NAHREP and a veteran real estate agent who worked with the Garcías in Las Vegas. “That first transaction for everybody becomes an opportunity to learn and understand the process,” she said. “Once they get it done, very often right after is when we’ll get the call that they actually want to know what they need to do so they can really prepare for the next purchase.” No longer daunted by the process, they are “more at ease with becoming homeowners on their own,” she said.

But there can be complications when adult children decide to buy on their own after co-buying with parents. Anabeth Rosado, a housing counselor with the nonprofit Congreso de Latinos Unidos in Philadelphia, advises younger clients to think about the long-term sustainability of the situation.

“Some of these people don’t see themselves staying with their parents forever,” she said. Rosado urges them to pay attention to residency requirements with homebuying grants.

Meanwhile, older clients should plan for the possibility that they will become empty nesters and their children will not contribute through the entire loan term, said Jose Deleon, another counselor at Congreso. “You’ve just got to think further along the line, where they’re not living there and if you’re still paying that mortgage,” he said.

These potential changes in household composition can make lenders wary of multigenerational buyers. “There is a bias against families who pool their resources to purchase a home,” said Gary Acosta, NAHREP’s chief executive and co-founder. They may be considered “riskier,” he said, because if a family member who joined the loan just to secure financing does not live in the property, moves out, or rents another place, the person is “not as vested in that property.”

Even beyond the issues with lenders, Acosta said he did not think multigenerational buying was ideal, because it’s often not done by choice. “I think it’s a reaction to what I consider to be one of the most challenging affordability crises that we’ve seen in a generation or more in the industry,” he said. “People are doing what they have to do, not necessarily what they want to do.”

Ricardo Ponce, a real estate broker whose firm worked with Danae Vega in Southern California, agreed. “The area that we’re in, a huge amount of the customers are Latino, and I think they just figure out a way to be a homeowner,” he said. “I think that’s everybody’s dream.”

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