Residents in neighborhoods with high levels of limited English proficiency have significantly lower rates of homeownership. On the other hand, neighborhoods with fewer LEP residents have higher rates of ownership,
according to a new study by the Urban Institute.
“We are not sure why and how limited English proficiency interferes with homeownership, but this research establishes that it is a barrier on top of other, more researched barriers,” Institute researchers note. “This finding suggests we might expand homeownership by better serving the LEP community.”
The Urban Institute study says that Spanish-language speakers make up 62 percent of the LEP population. Past studies by the Urban Institute also show that Hispanic households have lower homeownership rates than non-Hispanic white households. Researchers speculate that one factor contributing to the disparity may be from a limited English proficiency that is serving as a barrier to homeownership.
Overall, neighborhoods with the lowest concentration of LEP residents had a median homeownership rate of 74 percent in 2016. However, neighborhoods with the highest LEP concentration had only a 64 percent median rate. That is a 10 percentage point difference, the study notes.
The Federal Housing Finance Agency announced last fall that it would add a preferred language question to the redesigned Uniform Residential Loan Application. Lenders and regulators will then be able to gather more data on the size of the market of potential LEP homeowners. Urban Institute researchers called that a step in the right direction.
Source: “New Evidence Shows That Limited English Proficiency Is a Barrier to Homeownership,” Urban Institute (March 26, 2018)
