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City Prices Out Minority Home Buyers in Texas
The stricter development regulations being adopted by communities in Texas are pushing the cost of housing further beyond the financial means of the state’s minority households, according to a report by the Home Builders Association (HBA) of Greater Austin.
Findings of the study were released in February at a press conference that was attended by representatives of the League of United Latin American Citizens (LULAC) and the National Association for the Advancement of Colored People (NAACP). The study was conducted by DataSource and, in addition to the Austin builders, was also commissioned by the Texas Association of Builders (TAB) and NAHB.
The study focused on the city of Kyle, Texas, which passed two local ordinances in 2003 that increased the cost of a new $100,000 entry-level home by $20,000 and priced a significant share of Hispanic and African American home buyers out of the area’s new home market.
Prior to enactment of the new zoning restrictions, an annual income of $31,729 was needed to qualify for a $100,000 home in Kyle. After the restrictions took effect, the cost of the same house rose to $120,000 and qualifying income increased by $6,536 to $38,268.
“Owning a home is particularly important in the Hispanic community,” LULAC representative Tony Diaz said. “It’s disheartening to see evidence that shows a city is making it more difficult for minorities to purchase a home.”
“When a new home price increases by $20,000, a family must find an extra $163 a month to pay for a house payment,” said Nelson Linder, president of the NAACP’s Austin Chapter. “That dollar amount may prevent as many as 58,000 minority families in Texas from being able to move into Kyle — and that’s discriminatory.”
The study shows how many potential minority home buyers have been priced out of Kyle’s affordable housing market:
- In the Austin-San Marcos area, which includes Kyle, 58% of black, 62% of Hispanic and 76% of white families could afford a $100,000 home prior to the city’s new zoning restrictions. Afterwards, with a $20,000 price hike, only 51% of black households and 55% of Hispanic families could afford to buy that starter home, compared to 70% of whites.
- Among prospective buyers of a home in Kyle from across the state, 49% of black, 50% of Hispanic and 70% of white families could afford the $100,000 home. Only 42% of black and 42% of Hispanic households could afford to buy the $120,000 home, compared to 64% of white families.
- Among prospective buyers within the city of Kyle, 89% of black, 68% of Hispanic and 83% of white households could afford to buy the $100,000 home. At a $20,000 higher price tag, those percentages were 89%, 63% and 75%, respectively. (There are only 38 African American households in the city, compared to 692 that are Hispanic and 697 that are white.)
For more information, e-mail Melissa Loe at the HBA of Greater Austin, or call her at 512-454-5588 x105.
For more information on fair-housing issues, contact Duane Desiderio in NAHB's Legal Affairs Area, or call him at 800-368-5242 x8146.
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