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DENVER – Black and Hispanic homebuyers have a harder time finding homes they can afford in Denver than in the rest of the country as a whole, according to a new analysis from Zillow.
The real estate website looked at median income data for several racial groups – white, Hispanic, Asian, black and all groups – and found that nationwide, the typical buyer could afford about 74 percent of homes listed for sale in 2017.
That number drops to 55 percent for black buyers and 65 percent for Hispanic buyers. White buyers could afford nearly 78 percent of homes nationwide and Asian buyers could afford 85 percent.
For its analysis, Zillow considered a home to be “affordable” if a resident would spend less than 30 percent of their income on housing costs.
In Denver, black residents have a median annual income of $51,810, according to Zillow. At that earning level, a buyer could expect to afford a home no more expensive than $339,540, which leaves 36.9 percent of homes in the metro area within reach. For reference, the median home price surpassed $400,000 in March.
Hispanic buyers, with a median income of $53,495, can afford 41.3 percent of available homes.
White homeowners in Denver have a median income of $83,060, according to Zillow’s analysis, and can afford 77 percent of homes on the market while Asian buyers, with a median income of $74,174, can afford about 70 percent.
The overall median income in metro Denver is just over $74,000, according to Zillow, putting about 70 percent of homes within the “affordable” range for a buyer of any race making that amount.
The situation is even worse for minorities in some of the country’s most notoriously expensive cities – in Los Angeles, black homebuyers can afford just 11 percent of available homes and Hispanics can afford about 15 percent. And in San Francisco, black buyers can afford just five percent of homes on the market.
Portland, Ore. and Minneapolis, Minn. had the largest disparities, according to Zillow.
The numbers show that the gap between white and minority home ownership, which hasn’t changed meaningfully since 1900, continues to be a problem, Zillow said.
“The divide between black and white Americans has proven stubbornly persistent across the long arc of American history, visible in incomes, accumulated wealth and homeownership,” said Zillow Senior Economist Aaron Terrazas. “Greater wealth eases the path to homeownership, and the relationship becomes self-reinforcing: Homeowners have greater access to financial wealth that, in turn, makes it easier to become and remain homeowners. Distinct racial and ethnic gaps in homeownership exist nationwide, which could have long-lasting implications for future generations.”