Every time Danae Vega, 33, took a shower in her Southern California home, it was an ordeal. The pipes were broken, so the water did not drain. Each time, she would have to ask her younger siblings to remove the water by hand so the next person in the family of eight could take a shower. Requiring the owner to repair the pipes was not an option. “When we told the landlord to fix it, he always threatened us: ‘If I fix it, I’ll have to include it in the rent increase,'” she said.
Even without installing new pipes, it did increase it, however, and often: Ms. Vega reported repeated significant increases in 2022 and 2023. Needing to leave this situation and not wanting to end up in a similar situation, she and the her two sisters, three brothers and parents decided to buy a house.
Vegas is among a growing number of Latinos becoming homeowners in the United States. From 2019 to 2022, Hispanic homeownership increased more than any other demographic group, said Jung Hyun Choi, principal research fellow at the Urban Institute, a think tank. A study from Urban Institute projects that between 2020 and 2040, 70 percent of net new homeowners will be Hispanic;
For many Latinos, including in Vegas, first home ownership in an era of low inventory and high interest rates is possible because they buy as a family, combine incomes and rely on members with the best credit to take the lead.
And many Latinos already live in multigenerational homes. Analyzing data from the American Community Survey, Dr. Choi found that 63 percent of Latino households are multigenerational, compared to about 57 percent of Asian households and less than 50 percent of black or white households.
Oralia Herrera, a Chicago-area realtor who founded a local chapter of the National Association of Hispanic Realtors, said that in her 33 years in real estate, multigenerational purchases have been cyclical and are now returning because of housing market challenges.
“When I first started my career, I saw a lot of that,” he said. “It was the first time Latinos in my community were buying, and it was almost a given that we would have to put two to three names on that contract to get the loan.” He explained that there was a subsequent period of “better jobs, stability” and “better earnings”, which led to individual home buying. But now, because of high prices, “we’re back to where I started,” Ms. Herrera said.
And not just in the Chicago market, according to NAHREP: In a 2022 study, 19 of the top 25 real estate professionals from across the country “reported an increase in cohabitation, particularly among family members.”
There are several ways family members can become homeowners as a unit. In some cases, all contributing family members are borrowers and legal owners. In other cases, some family members are informally involved if their credit profiles might lead to less favorable loan terms.
Ms. Vega said her parents, originally from Michoacán, Mexico, tried to buy a house several times but never succeeded. On one occasion, he recalls, their friends talked about it: “They would say, ‘Why are you going to take it?’ Such a big responsibility.” Another time, faith problems got in the way, Ms. Vega said.
So in March 2023, Ms. Vega and her 28-year-old sister Ashley were the ones who bought the $331,000 three-bedroom, two-bathroom home on a half-acre in San Bernardino County, where the whole family now lives.
The Vega sisters’ position — not just as first-time homeowners, but as first-generation homeowners — is common among young Hispanic buyers, according to Laura Arce, senior vice president for financial initiatives at UnidosUS, a civil rights organization. Latinos, he said, are “the largest share of new homebuyers coming in.”
In 1994, the Hispanic home ownership rate it was 40.3 percent. At the end of 2023, it was 49.8 percent. The increase is particularly notable because during these decades, the Hispanic population in the United States almost tripled — to 62.1 million in 2020, up from 22.4 million in 1990.
Although Danae and Ashley Vega are de facto single, they see their home as a shared asset. The whole family helped with the property search and everyone contributes, whether financially or domestically. “My dad already built a chicken coop outside,” Danae said. “My mom has already decorated the whole living room and kitchen. I don’t feel like it’s just my house or my sister’s house. We feel like it’s all ours.”
In many cases of multi-generational purchases, the home is not only considered to belong to members from generation to generation — it does so legally. Alexandra García, 21, and her father, Rosalio García, 52, bought their first home together last year in Las Vegas. They were eager to own, because renting seemed like a waste of money. “In the 10 years I lived in the previous rental house, I threw almost more than $100,000 in the trash,” Mr. Garcia said in Spanish.
For Mr. García, an auto mechanic who immigrated from Nayarit, Mexico, more than 30 years ago, home ownership was out of reach largely because he had no credit history. This lack of established credit is common among Hispanic immigrants, according to Vicky Garcia, CEO of Latino Community Credit Union. “In Latin America, having credit is a bad thing,” said Ms. Garcia, who is originally from Colombia. “If you don’t need a credit card because you have enough cash to live on, you won’t get a credit card.” Others may hold out because they don’t understand how the system works or feel intimidated by commercial banks, he explained.
Unlike her father, Alexandra García had been getting credit cards from retail stores since the age of 18, followed by cards from major banks, but her job at a TJ Maxx warehouse didn’t make her feel “financially stable” enough to to buy a house on her own. So she added her father as an authorized user on her credit cards, which gave him credit history, and in July they bought the $375,000, 1,600-square-foot, three-bedroom, two-bathroom home they share with Ms. Garcia’s twin. . sister and her mother, Mr. Garcia’s wife. Both Alexandra and Rosalio Garcia have the residence permit and the loan.
For Alexandra, sharing her credit and helping her family buy their first home was an honor. “Our parents, they’ve done so much for us,” she said. “There is something we could do to return that favor.”
Alejandro Rodriguez, 25, of Mesquite, Texas, was also happy to be able to help his 48-year-old mother, a Mexican immigrant, achieve her “American dream” after years of moving around in rentals during his childhood. A few months ago, he signed and closed on the 1,500-square-foot, four-bedroom, two-bathroom home that his mother and siblings live in. just because it was my mom’s dream to own a house and I know how much she sacrificed for us,” he said. “It was a great feeling.”
Credit isn’t the only barrier to homeownership driving multigenerational purchases. With today’s high home prices, many families find it advantageous, and often necessary, to combine incomes to qualify for a loan.
Gustavo Garcia, 45, a Chicago business owner who immigrated from Guerrero, Mexico, did just that. “My faith was good,” he said in Spanish. “But for the house we wanted, we needed a little help from my son.” A few months ago, he and his 25-year-old son, a restaurant chef, closed on their $235,000 three-bedroom home with lots of space and laundry in the basement. Both father and son are in on the loan and the deed, and hope the purchase will be a stepping stone to home ownership for the younger Garcia as soon as this year.
Family members who buy together as first-time owners often go on to buy individually later, according to Nora Aguirre, NAHREP’s 2024 president and a veteran real estate agent who worked with the Garcías in Las Vegas. “This first transaction for everyone becomes an opportunity to learn and understand the process,” he said. “Once they’ve done that, very often right after we get the call, they really want to know what they need to do so they can really prepare for the next purchase.” No longer intimidated by the process, “they’re more comfortable becoming homeowners on their own,” he said.
But there can be complications when adult children decide to buy on their own after co-purchasing with parents. Annabeth Rosado, a housing consultant at the nonprofit Congress of United Latinos in Philadelphia, advises younger clients to think about the long-term sustainability of the situation.
“Some of these people don’t see themselves staying with their parents forever,” he said. Ms. Rosado urges them to pay attention to residency requirements with homebuyer grants.
Meanwhile, older clients should plan for the possibility of becoming empty nesters and their children not contributing throughout the life of the loan, said Jose Deleon, another adviser at Congreso. “You just have to think further down the line, where they don’t live there and if you’re still paying that mortgage,” he said.
These potential changes in household composition may make lenders wary of multigenerational buyers. “There is a bias against families pooling their resources to buy a home,” said Gary Acosta, CEO and co-founder of NAHREP. They can be considered “more risky,” he said, because if a family member who joined the loan just to secure financing doesn’t live in the property, move out or rent another place, the person “isn’t as vested in that property. “
Even beyond the issues with lenders, Mr. Acosta said he didn’t think the multigenerational purchase was ideal because it’s often not done by choice. “I think it’s a reaction to what I see as one of the most difficult affordability crises we’ve seen in a generation or more in the industry,” he said. “People do what they have to do, not necessarily what they want to do.”
Ricardo Ponce, a real estate broker whose firm partnered with Danae Vega in Southern California, agreed. “In the area that we’re in, a huge number of customers are Latino, and I think they’re just finding a way to become a homeowner,” he said. “I think that’s everybody’s dream.”
It’s already paid off for the Garcias in Las Vegas: According to Mr. Garcia, in just a few months, the value of their home went up $10,000, creating wealth for the family.
For Ms. Vega, home ownership has brought great relief. She no longer worries about sudden and frequent rent increases, she sleeps better, she said, and her family has “a sense of peace” and “enthusiasm to work at home.”
Ms. Vega sees the success of the family’s home-buying effort as an embodiment of the advice her father gave her and her siblings throughout their lives. “He always told us, ‘The Union makes us stronger,'” he said. “La union hace la fuerza.”