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The homeownership rate among Asian Americans and Pacific Islanders has seen a “remarkable surge”—now over 60%—but the affordability crisis is threatening further gains for this community, according to the 2023 State of Asia America Report released by the Asian Real Estate Association of America. Fully unlocking this segment of eager home buyers will require policy changes and extra attention to key issues that are holding back further progress, says Sharon Wong, president of the Chicago chapter of AREAA.
The report shows that members of the AAPI community have higher income levels than the typical consumer in most areas and are well-positioned for homeownership. But they’re still facing plenty of barriers, the report warns. Wong, who also is president and CEO of Century 21 Realty Associates in Chicago, spoke with REALTOR® Magazine about what can be done to help increase the AAPI homeownership rate even more.
Q: What are the greatest challenges the AAPI community faces in regards to homeownership?
A: Recently, I was in Washington, D.C., joining the AREAA National Diversity and Fair Housing summit. During the summit, we presented three key legislative points aimed at addressing the challenges faced by the AAPI community. Those are:
- Down payment assistance
- Appraisal equity
- Data disaggregation
Language barriers remain a top challenge for many AAPI buyers. Down payment assistance and affordability are also major concerns. To address these issues, AREAA has made significant strides. For instance, AREAA has successfully collaborated with the GSEs to create translated documents and tools to assist mortgage borrowers who have limited English proficiency. Our bilingual brokers play a crucial role in helping buyers navigate the real estate industry despite the additional work required to ensure their understanding.
Many new immigrants work tirelessly—often holding multiple jobs—to save for a large lump sum down payment since their income may not qualify them for loans above 80% loan-to-value. Moreover, new immigrants often have thin or no credit. Sometimes, they can’t even get a car loan. Additionally, as many prefer to live within their community, such as in Chinatown, it creates a demand-supply imbalance that affects housing affordability. AREAA is committed to promoting sustainable homeownership within the AAPI community and will continue to advocate for policies that address these challenges and support the long-term stability of homeownership.
The report notes that the middle-income bracket within the AAPI community is lagging in homeownership. What hurdles are they facing? What do you feel needs to be addressed to increase their ownership rates?
While the median income of the AAPI community is above the national average, it’s important to acknowledge that many AAPI buyers reside in metropolitan cities where housing affordability has significant challenges. The high cost of housing in these areas often creates a barrier to homeownership for individuals and families within the AAPI community. I believe down payment assistance programs or special loan programs tailored to the specific needs of AAPI home buyers is crucial.
It’s also important to recognize the diversity within the AAPI community. Asians encompass various subcategories, such as Hmong, Burmese and Lao, among others. Identifying and understanding the specific needs and challenges faced by these subgroups can enable us to develop targeted solutions for homeownership.
How can real estate professionals better serve this population?
I suggest REALTORS® collaborate with AREAA to allow real estate professionals to gain deeper insights into the specific barriers and cultural expectations that AAPI buyers may face. By actively engaging with AREAA and participating in its events, real estate professionals can develop a better understanding of the unique challenges and needs of the AAPI community.
Furthermore, community engagement plays an important role in serving the AAPI buyer market. My company hosted, cohosted and sponsored over 30 events in the community last year. Real estate professionals who proactively reach out and connect with local AAPI communities can establish trust and credibility. Attending cultural events, building relationships with community leaders and sponsoring community initiatives are effective ways to demonstrate a genuine commitment to serving the AAPI population.
By embracing these approaches, real estate professionals can elevate their service to the AAPI population, ensuring that they are equipped with the knowledge, cultural understanding and connections necessary to meet the unique needs and aspirations of AAPI buyers.
Do you believe the AAPI population's desire for homeownership will continue to grow? What are your predictions for their homeownership rates?
I firmly believe AAPI homeownership will continue to grow. Homeownership has long been a significant goal for many families within the AAPI community. Our cultural values and traditions emphasize owning a home as a symbol of stability, wealth-building, a sense of belonging and a better future.
As an immigrant to Chicago with my parents, I witnessed the dedication and hard work they put in to make our American dream come true. I think that AAPI homeownership rates will catch up to the national average and continue to rise because of the collaborative efforts of REALTORS®, strategic partners and organizations like AREAA.
Breakdown of AAPI Buyer Trends
The homeownership rate among the AAPI population tends to be higher than Black and Latino Americans but still lags behind Whites. AREAA’s report provides a snapshot of a few areas within the Asian population that are garnering the most real estate attention lately.
Asian Indian Americans
- Median income: $153,050
- Homeownership rate: 62%
Top metros:
- New York-Newark-Jersey City, N.Y.-N.J.
- Dallas-Fort Worth-Arlington, Texas
- San Francisco-Oakland-Berkeley, Calif.
- San Jose-Sunnyvale-Santa Clara, Calif.
- Chicago-Naperville-Elgin, Ill.
Chinese Americans
- Median income: $103,500
- Homeownership rate: 66.3%
Top metros:
- New York-Newark-Jersey City, N.Y.-N.J.
- Los Angeles-Long Beach-Anaheim, Calif.
- San Francisco-Oakland-Berkeley, Calif.
- San Jose-Sunnyvale-Santa Clara, Calif.
- Boston-Cambridge-Newton, Mass.-N.H.
Filipino Americans
- Median income: $107,000
- Homeownership rate: 64.3%
Top metros:
- Los Angeles-Long Beach-Anaheim, Calif.
- San Francisco-Oakland-Berkeley, Calif.
- Honolulu, Hawaii
- New York-Newark-Jersey City, N.Y.-N.J.
- San Diego-Chula Vista-Carlsbad, Calif.
Vietnamese Americans
- Median income: $82,900
- Homeownership rate: 69.2%
Top metros:
- Los Angeles-Long Beach-Anaheim, Calif.
- San Jose-Sunnyvale-Santa Clara, Calif.
- Houston-The Woodlands-Sugar Land, Texas
- Dallas-Fort Worthington-Arlington, Texas
- San Francisco-Oakland-Berkeley, Calif.
Korean Americans
- Median income: $100,000
- Homeownership rate: 54.2%
Top metros:
- Los Angeles-Long Beach-Anaheim, Calif.
- New York-Newark-Jersey City, N.Y.-N.J.
- Washington-Arlington-Alexandria, D.C.-Va.
- Seattle-Tacoma-Bellevue, Wash.
- Atlanta-Sandy Springs-Alpharetta, Ga.
Native Hawaiian Americans
- Median income: $78,000
- Homeownership rate: 55%
Top metros outside of Hawaii:
- Los Angeles-Long Beach-Anaheim, Calif.
- Seattle-Tacoma-Bellevue, Wash.
- San Francisco-Oakland-Berkeley, Calif.
- Salt Lake City
- San Diego-Chula Vista-Carlsbad, Calif.
*Top metros in Hawaii: Honolulu and Kahului-Wailuku-Lahaina
