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Study Finds Housing Prices Thwart Latino Immigrants

Finances: Pepperdine researchers say chance for homeownership grows distant--not just for the newly arrived, but for their children as well.

September 24, 2002|JOSE CARDENAS | TIMES STAFF WRITER

The barriers faced by Latinos--who represent a plurality of the state's new households--highlight the dilemma faced by all Californians hoping to buy homes, according to new research to be released today.

But the study by Pepperdine University also warns of a particular problem for Latinos: A wildly expensive market lacking in inventory represents the first time that a largely immigrant but upwardly mobile group could be widely prevented from reaching the American dream that, in general, other immigrant groups have achieved.

"What you don't want to see in California is a creation of a large middle class that feels that not only will they not be able to buy a home, but their children won't be able to buy a home," said co-author Joel Kotkin, a senior fellow at the Davenport Institute for Public Policy at Pepperdine University.

While other private and government studies have documented the housing crisis, Pepperdine's study--"Rewarding Ambition: Latinos, Housing and the Future of California"--aimed to find out what the state's "rising new majority" was experiencing, said Thomas Tseng, a research fellow at the Davenport Institute.

"In the future, the Latino population will become the mainstream, and we realized that housing would be one of the primary issues that they would have to deal with," Tseng said.

The study included culling information from databanks and interviewing 504 Spanish-surnamed renters and recent home buyers from throughout the state.

Among the highlights of the study, researchers found that Latinos, about a third of the population, buy more than 20% of all homes in California. While nearly two-thirds of U.S.-born Latinos are homeowners, less than a third of Latino immigrants are. Those who are homeowners, native and immigrant, are largely recent purchasers.

The rise of prices making it difficult to buy homes in California coincides with an influx of immigrants in the last two decades, according to the authors. In California, Latino immigrants are by and large renters, and their desire to own is driven primarily by their plans to form or grow their families.

But most prospective home buyers--lacking the generational resources that many longer-established Americans have--are looking for affordable homes below $150,000 with a down payment of less than $10,000. Despite the obstacles, 70% of those interviewed reported being optimistic about their chances of buying a home within five years.

The study aims to help change government policies to allow greater numbers of new housing units to be built--which the authors say would bring home prices down.

It particularly aims to catch the attention of Latino legislators caught between the housing shortage that affects the Latino community and groups that favor limited development or oppose it altogether.

"This issue of housing crisis and shortage has been discussed quite a bit already, [but] in many ways it has fallen on deaf ears," Tseng said.

"It has not created ways in which to solve the impediments of housing in California for developers."

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