Housing

Houston initiative addresses systemic barriers for people of color in homebuying process

People of color sometimes struggle to buy a home because of multiple factors such as higher interest rates or being denied a home loan altogether. The program will provide potential homebuyers with housing counselors and resources to make the home-buying process easier. 

Own the HOU helps people of color in the homebuying process.
Own the HOU helps people of color in the homebuying process.

A new program aims to bridge the gap for people of color becoming homeowners.

Own the HOU is a new initiative that addresses systemic barriers by educating and connecting new and existing homeowners with resources to help with purchasing a home. Wells Fargo's investment of $7.5 million through their Wealth Opportunities Restored through Homeownership initiative, started the program, which is led by Local Initiatives Support Corporation (LISC).

People of color sometimes struggle to buy a home because of multiple factors such as higher interest rates or being denied a home loan altogether. The program will provide potential homebuyers with housing counselors and resources to make the home-buying process easier.

According to a survey by the Kinder Institute for Urban Research at Rice University, prior to the pandemic, inflation rates rose approximately 2% every 12 months. Due to the pandemic and the worldwide supply-chain shortages, inflation hit a peak of 10.2% in June 2022, it lowered to 5.3% in Dec. 2022, but the rate of inflation is still twice as much as it was two years ago.

The current mortgage interest rates are 7.49% for a 30-year plan and 6.78% for a 15-year plan, according to the Houston Association of Realtors.

The hike in interest rates is a main barrier for people on the path to becoming homeowners, said Keith Bynam, the Director of the city's Housing and Community Development Department.

"Everything we do is to try and develop affordable housing and affordable housing in today's market is really, really, unreasonable," said Bynam. "We're hoping that this program will change the focus of individuals and allow them to start thinking about becoming a homeowner in order to create that generational wealth that we've all been talking about."

Thao Costis, the Executive Director of the Harris County Community Services Department, talked about the city's efforts to curb homelessness and how that also impacts the new initiative.

"It is a truly extreme challenge to the people who have been left out of the ability to afford housing first of all, much less own their homes," said Costis. "We are all here in need for the people who have been traditionally left out, who have been systematically left out, to be included and to be able to have the opportunity here."

The City of Houston and Harris County were able to bring down the homelessness rates by more than 60% over these last 12 years. However, 70% of the people who experience homelessness are Black or African American, while the population in Harris County is only 20% African American or Black.

Harris County will additionally be investing over $100 million over the next three years just for the homeowner side by using funds from disaster recovery funds, the American Rescue Plan, and the annual HUD endowment.

"Today, we take a significant step towards helping communities of color level the playing field when it comes to homeownership," said Harris County Commissioner Rodney Ellis in a press release. "Together, we can build a stronger and more equitable future by helping to provide an opportunity for Harris County’s residents to build generational wealth through homeownership."

By 2025, Own the HOU aims to help 5,000 new households achieve homeownership while helping existing homeowners preserve their homeownership.

"Limited access to essential resources and tools has hindered the path to homeownership for people of color. This transformative initiative marks the commitment to empower and uplift people of color," said Mayor Sylvester Turner, in a press release. "With Own the HOU, we stride together towards a more inclusive and equitable future, ensuring every individual can successfully own a home in our city."