September 19, 2021

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Mortgage News

Black New York City Homeowners Face Steeper Homebuying Costs

Overall, home ownership by blacks in the city has fallen by 13 percent over the past two decades (iStock).

Overall, home ownership by blacks in the city has fallen by 13 percent over the past two decades (iStock).

Covid has exacerbated financial challenges for black homeowners looking to buy a home in New York City, according to a new report.

The Center for NYC Neighborhoods said the average black homeowner pays $ 7,000 more in closing costs than white buyers and they face higher interest rates. The results are based on a survey of homeowners and housing consultants that began in 2019, City Limits reported.

Overall, black home ownership in the city has dropped 13 percent over the past two decades and continued to decline during the pandemic.

The report found that the higher cost pattern existed for conventional mortgages and for Federal Housing Administration (FHA) mortgage loans available to buyers with lower credit scores.

“We know that people who take out FHA loans are likely to pay more because an FHA loan is by definition more expensive. However, we were surprised to see that the pattern also applies to conventional lending, ”Ivy Perez, policy and research manager at the Center for NYC Neighborhoods, told City Limits.

The center attributed the decline in black home ownership to this systemic Problems, along with the aftermath of the 2008 foreclosure crisis. According to the report, 80 percent of black homeowners surveyed had trouble paying for repairs and finding trustworthy contractors.

Based on the research results, the center has developed five pilot projects Programs to address some of the challenges, including a tool to help with the down payment and assisting landlords in their efforts to maintain affordable rents.

[City Limits] – EB Solomont