The Tight Housing Market Boxes Out Government-Insured Borrowers, Widening Homeownership Gaps

A recent post from the Urban Institute highlights the ways in which lower income borrowers are disadvantaged in the current housing market. The authors suggest that the pandemic-era housing market favoring sellers facilitates discrimination against buyers using loans from the Federal Housing Administration and U.S. Department of Veterans Affairs. Urban’s analysis of government and government-sponsored enterprise loan originations finds that FHA loans in have declined from 22.8 percent of these loans in 2017 to 18.9 percent in early 2021. Since FHA loans are more often utilized by those with lower income, credit scores, and wealth—many of whom are buyers of color— this trend reinforces racial-ethnic gaps in home ownership. #covid-19 #racialequity #housing #wealth&assets

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