Homeownership among Black Americans has consistently trailed behind all others in the country, including by 28% compared to white homeowners. However, according to a new report by the National Association of Realtors (NAR), Black homeownership is expected rise in the future. 

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How? As more Millennials and Gen Z enter into the home buying market, there will be a rise in minority owners. This is because on average, this demographic is more racially and ethnically diverse. 

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Future predictions - 1.5 million Black households will turn the median homebuying age over the next 5 years. Female and millennial buyers have been driving growth in Black homeownership and will continue to do so. Besides Black households, 775,000 Asian households and 2.2 million Hispanic households will also turn the median homebuying age in the next 5 years.

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Challenges remain - Barriers such as rental affordability, student debt, and mortgage denial rates persist, hindering Black Americans' ability to purchase homes and achieve equitable homeownership rates. Addressing these challenges will be crucial to fostering greater inclusivity in the housing market.

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The United States is grappling with a housing crisis characterized by a shortage of millions of units and soaring housing costs for renters and buyers alike. To address this, cities are revising zoning rules to allow for more housing development, focusing on measures such as permitting multifamily homes in diverse neighborhoods and streamlining construction processes.

Minneapolis is leading the way with its progressive zoning reforms, adding 12% to its housing stock in just a five-year period. The city has taken measures such as ending single-family zoning and promoting midsize apartment buildings with 20 or more units. In Houston, minimum lot sizes were reduced from 5,000 square feet to 1,400, allowing for more units to be constructed. Milwaukee, New York City and Columbus, Ohio, are other examples of cities undertaking reform of their codes.

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In 2024, the rental market is poised for transformation with two key factors: the growing impact of artificial intelligence (AI) tools and heightened competition among the multifamily rental market. A survey by AppFolio indicates that nearly half of property management professionals either use AI or plan to adopt it. Property managers face the challenge of maintaining high occupancy rates amidst a competitive market, with delinquencies identified as a top threat. To thrive in this changing landscape, property managers are leveraging AI to enhance operational efficiency, streamline tasks, and improve employee satisfaction, while also focusing on understanding resident expectations and offering digital services to attract and retain modern renters. A strategic technology approach is crucial for success in 2024 and beyond.

Photo by Towfiqu barbhuiya on Unsplash

In 2021 and 2022, the commercial real estate sector experienced a surge in proptech adoption, leading to increased investment. However, a recent report from the Center for Real Estate Technology and Innovation highlights a slowdown in momentum during 2023, attributed to factors such as inflation and geopolitical uncertainty. Venture capital investment in proptech witnessed a significant decline of 42% in 2023, amounting to $11.38 billion, compared to the previous year's total of $19.75 billion and the peak of $32 billion in 2021. Notably, the multifamily segment is being hailed as resilient, owing to continued robust activity in technologies targeting this space. What remains popular are technologies that help solve consumer problems, like reducing fraud.

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(Photo by Luis Villasmil on Unsplash)

Rising rents and reduced working hours during the COVID-19 pandemic have left many U.S. renters struggling to make ends meet, with a record 50% paying over 30% of their income on rent and utilities, per Harvard University's report. The unaffordability trend saw the most significant jump among households earning $30,000 to $74,999 annually, with a third of full-time renters still being heavily cost-burdened. Even lower-income renters, already facing severe challenges, experienced a further increase to 83% being cost-burdened. The report attributes the homelessness surge to a severe housing shortage and rising rent costs, exacerbated by a lack of affordable housing options. Despite a cooling housing market, the cost of construction has hit record highs leading to the construction of predominantly high-end apartments. This is further contributing to a growing affordability gap, with median rents outpacing income growth since 2001. The situation has increased demand for federal housing subsidies, which remain underfunded and insufficient.

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Modular housing is seen as a solution to housing shortages, offering efficiency, and cost reduction, but many companies like Katerra and Veev have failed to achieve financial viability. What is ailing the manufactured homes market? Experts believe over-regulation by the Government in the form of restrictive zoning laws, hinders industry growth for these companies. They are unable to build at scale and therefore, unable to turn a profit. Perceptions of inferiority and a lack of consistent demand pose challenges as well. The Biden administration has proposed easing regulations but it's still a long road ahead for companies that are working in this space.

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In the first quarter of 2024, home prices increased in 93% of U.S. metro areas, with significant growth observed in 30% of these markets. The national median price for single-family homes rose to $389,400, marking a 5% year-over-year increase. The South led in sales volume, while the Northeast saw the highest price appreciation. Despite high mortgage rates, market conditions improved slightly for buyers due to a marginal decline in required mortgage payments compared to the previous quarter.

After Kathy Hochul's failed New York Housing Compact plan last year, New York State is trying again to tackle its severe housing crisis. According to anonymous sources close to the deal, New York state leaders have reportedly reached a tentative agreement on a legislative plan to tackle the crisis and will be presented to the full Senate and Assembly on Monday. The framework of the deal offers incentives for both developers and tenants. Developers would receive significant tax breaks to develop more affordable units, while tenants would benefit from enhanced protections against eviction in certain cases. Additionally, the agreement would allow landlords of rent-stabilized apartments to raise rents for renovation costs and eliminate size restrictions on new Manhattan apartment buildings, fulfilling long-standing desires of city officials.

The housing market for buyers in California is becoming increasingly challenging. Prices are soaring while the inventory remains limited. Statistics reveal a stark reality: home prices have surged 9.7% over the past year, with the median home price now at $813,980. Meanwhile, inventory levels have plummeted by 48.3%, exacerbating the affordability crisis. Despite historically low mortgage rates, competition remains fierce, leading to bidding wars and further price escalation. Experts suggest that while the market may stabilize in the long term, immediate relief for buyers appears unlikely.

Currently, the average rate for a 30-year mortgage stands at around 6.9%, a significant decrease from late October when it peaked at nearly 8%. Despite expectations of rates declining later in the year, some buyers are opting to act now due to fears of increased competition. The combination of high mortgage rates and soaring home prices has made affordability a major concern, with many households earning less than what's needed to afford a median-priced home. While economists anticipate mortgage rates easing, uncertainty remains.

There are ongoing bipartisan efforts at various levels of government to address housing supply and pricing challenges in the United States. The importance of local action in addressing these issues, particularly through measures such as accessory dwelling units (ADUs), changes in zoning rules, and reduction of lot sizes, is increasingly becoming evident. Despite political differences, lawmakers in some states are collaborating on bipartisan housing legislation. However, challenges such as NIMBYism hinder progress at the local level, prompting calls for state-level intervention to overcome resistance to housing reforms. 

Los Angeles Mayor Karen Bass took office in 2022 and since then, has been making a big push to address homelessness, particularly in Venice Beach. Mayor Bass initiated the Inside Safe program to provide motel rooms for homeless residents, resulting in cleaner sidewalks and parks in Venice Beach. However, challenges persist, including budgetary constraints and the need for permanent housing solutions. Critics accuse Bass of prioritizing aesthetics over long-term solutions, while supporters applaud her urgency in tackling the crisis. Despite progress, concerns remain about the sustainability and effectiveness of current efforts, highlighting the complex nature of addressing homelessness in Los Angeles.

The National Low Income Housing Coalition report shows Texas only has 29 available and affordable rental homes per 100 extremely low-income renters. The report ranks Houston, Dallas, and Austin in the top ten worst major metro cities for affordable housing.

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Source - iStockphotos

With climate change making severe weather events more common and the area’s housing crisis increasing the number of people who need support, the operation of the shelters is taking an increasing toll on county and city officials and budgets, as well as the community volunteers whose labor the region relies on to run the shelters.

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Image credits - Mika Baumeister/Unsplash

On January 10, 2023, Governor Kathy Hochul announced a statewide strategy to address New York’s housing crisis. This new plan, named The New York Housing Compact, aims to build 800,000 new homes over the next decade to meet the state’s historic housing shortage.‍

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Hochul’s Compact would have boosted housing production in New York City’s suburbs, by overriding local planning boards that limit most land to single-family detached homes. However, it didn't make it past the State Budget after heated negotiations at the State Legislature.

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What is next for New York's affordable housing future?

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Imade credits - Mike Groll/Office of Governor Kathy Hochul

In recent years, Florida has become one of the least affordable places to live in the nation, making affordable housing one of the top issues impacting Floridians. While the state’s reputation as a place for leisurely coastal living has made it a popular retirement destination for seniors, Florida has also seen an influx of young, high-earning professionals from states like New York, where the median home price is nearly double that of Florida’s. While individuals from states like New York or California — two states with some of the highest average incomes in the country — may find Florida to be more affordable, everyday Floridians are paid lower wages on average and renters in Florida have historically been more cost-burdened than any other state in the nation. In the span of just two years, median rent prices increased by over 30 percent across the state, from about $1,340 in February 2020 to roughly $1,760 in February 2022. To afford a modest one-bedroom rental home at fair market rent, a person earning $10 per hour (the state’s minimum wage for most of 2022) would need to work 86 hours per week.

The National Low Income Housing Coalition report shows Texas only has 29 available and affordable rental homes per 100 extremely low-income renters. The report ranks Houston, Dallas, and Austin in the top ten worst major metro cities for affordable housing.

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Source - iStockphotos

With climate change making severe weather events more common and the area’s housing crisis increasing the number of people who need support, the operation of the shelters is taking an increasing toll on county and city officials and budgets, as well as the community volunteers whose labor the region relies on to run the shelters.

​

Image credits - Mika Baumeister/Unsplash

On January 10, 2023, Governor Kathy Hochul announced a statewide strategy to address New York’s housing crisis. This new plan, named The New York Housing Compact, aims to build 800,000 new homes over the next decade to meet the state’s historic housing shortage.‍

​

Hochul’s Compact would have boosted housing production in New York City’s suburbs, by overriding local planning boards that limit most land to single-family detached homes. However, it didn't make it past the State Budget after heated negotiations at the State Legislature.

​

What is next for New York's affordable housing future?

​

Imade credits - Mike Groll/Office of Governor Kathy Hochul

In recent years, Florida has become one of the least affordable places to live in the nation, making affordable housing one of the top issues impacting Floridians. While the state’s reputation as a place for leisurely coastal living has made it a popular retirement destination for seniors, Florida has also seen an influx of young, high-earning professionals from states like New York, where the median home price is nearly double that of Florida’s. While individuals from states like New York or California — two states with some of the highest average incomes in the country — may find Florida to be more affordable, everyday Floridians are paid lower wages on average and renters in Florida have historically been more cost-burdened than any other state in the nation. In the span of just two years, median rent prices increased by over 30 percent across the state, from about $1,340 in February 2020 to roughly $1,760 in February 2022. To afford a modest one-bedroom rental home at fair market rent, a person earning $10 per hour (the state’s minimum wage for most of 2022) would need to work 86 hours per week.