Homeownership Among AAPI Communities Is on the Rise, but Barriers to Entry Remain

When it comes to social issues, progress tends to be slow, and not at all steady. Just when we think we're getting ahead, situations pop up that drag us back to the 1950s. In regard to life in America for Asian Americans and Pacific Islanders (AAPI), there's both positive and somewhat discouraging news.

Pandemic-related concerns

The first six months of the COVID-19 pandemic were rough for Asian Americans hoping to buy a home. It was during that time that hate crimes against Asian Americans increased by nearly 150%. Households who'd spent years saving up for a down payment had to decide if it was safe to leave their support systems. As other home buyers moved to more affordable cities and suburbs, members of the AAPI community faced the choice of leaving their current homes and potentially becoming isolated from the larger Asian-American community.

Many opted to hold off, and AAPI housing activity dropped 8.1% lower than pre-pandemic levels, and 9.5% lower than that of their non-Asian peers.

While there's no way to say for certain how large a role the increase in hate crimes played, those early months of the pandemic saw fewer Asian Americans buying homes.

The tide slowly turns

Between the fourth quarter of 2020 and the fourth quarter of 2021, homeownership among AAPI households began to climb, increasing from 59.5% to 61.2%. Despite a raging pandemic, greater numbers of AAPI households were heading out to secure mortgages and house hunt.

A homeownership rate of just over 61% may not seem like much, but it represents an all-time high for the AAPI community.

Although a steady drumbeat reminds us that every American should own a home, homeownership is not the right move for everyone. In fact, renting is a better financial move for some people.

Still, there's an argument to be made for using homeownership as a stepping stone to generational wealth. According to the San Diego Foundation, owning a home opens the door to investing. It helps improve the homeowner's credit and ultimately, their buying power. A home represents a valuable asset that can be passed down through generations.

Although there has been an increase in the number of AAPI families who own homes, there are still barriers that must be overcome.

AAPI women face unique challenges

For AAPI women, the quest to purchase a home of their own is even more difficult. The National Women's Law Center (NWLC) compared the median earnings of all AAPI and Native Hawaiian women who worked full time, year-round in 2021 to the median earnings of all white, non-Hispanic men who worked, regardless of how many hours they were on the job. They found that AAPI and Native Hawaiian women were typically paid only $0.80 for every dollar paid to white, non-Hispanic men.

Among some women, the news was worse. For example, Indian women earn just $0.60 for every dollar paid to Indian men, and Taiwanese women make just $0.63 for every dollar paid to Taiwanese men. In other words, they're not just lagging behind white male workers.

One of the devastating consequences of the wage gap is the inability these women have to save up enough for a down payment. Data indicates that 62.2% of single AAPI and Native Hawaiian women own a home, compared to 67.7% of single white, non-Hispanic men. While a difference of 5.5% may not seem like much, the percentages represent millions of American women who can't quite harness the economic advantages that come with homeownership.

Male or female, the struggle for members of non-white communities to buy into the American dream continues to be an uphill battle.