Although Hispanics were hit harder than most during the Great Recession – and predominantly Hispanic neighborhoods have been the slowest to bounce back – they are more likely than whites, blacks or Asians to associate homeownership with the American Dream, according to Zillow’s latest Housing Confidence Index.
Of Hispanic respondents surveyed, 70 percent said owning a home is necessary to live “the good life” and the American Dream, compared with 64 percent of Asian respondents, 63 percent of black respondents and 60 percent of white respondents.
Hispanics also are more likely than the general public to say you can succeed if you work hard, that a college degree is necessary to be successful in the United States, and that the future is brighter for their children than it has been for them, said Mark Hugo Lopez, the Pew Research Center’s Director of Hispanic Research.
He and others trace such optimism to the way new immigrants perceive this country.
“It’s true of immigrants today and in the past. While the majority of Latinos may be U.S. born, half of all adult Hispanics are immigrants, so the immigrant experience looms large for many Hispanic families,” Lopez said.
Thomas Thibodeau, a professor of real estate at the University of Colorado’s Leeds School of Business, agrees that recent immigrants tend to arrive in the United States believing that homeownership is critical – and achievable – in the United States.
“Homeownership has been promoted by the government as well as by trade associations as part of the American Dream,” said Thibodeau.
The idea has deep roots. Franklin Roosevelt said in the ’30s that a nation of homeowners was “unconquerable.” And in 2003, Congress unanimously passed the American Dream Down Payment Act.
Tying homeownership to economic well-being for everyone, however, is a myth, Thibodeau said, and he doesn’t like to see it perpetuated. “Homeownership makes a great deal of sense if people expect to be in their homes for a number of years,” he said.
Using Zillow data, the professor found that home value volatility is about twice as high in low-income neighborhoods as middle-income neighborhoods.
When the economy goes sour, equity in low-income areas is “wiped out a lot faster,” he said.
Some evidence indicates that’s because they lose their jobs first, leading to foreclosures, which can snowball into lower values across neighborhoods.
Zillow’s latest survey, co-sponsored by Pulsenomics LLC, also found that 65 percent of millennials associate homeownership with the American Dream – more than any other generation. They also expect home values to appreciate 5 percent annually over the next decade, more than any other age group.