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Black first-time home buyers see strongest rebound as national rates decline

1. Record 63% Black first-time home buyer rate in 2023. Indicates market shift. 2. Zillow’s down payment tool aids Black buyers. Expect revenue uplift. 3. Tax credits and flexible lending improve homeownership access. Supports long-term growth. 4. Remote work boosts buyer reach by 29%. Reflects evolving market dynamics.

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Why Bullish?

Zillow’s initiatives targeting Black first-time buyers tap a historically underserved segment, likely driving revenue growth. Past similar market expansions have positively impacted stock performance.

How important is it?

The article outlines key strategies and market shifts that support Zillow's positioning, despite ongoing affordability challenges.

Why Long Term?

The emphasis on sustainable policy support and technology-driven tools indicates gradual market share gains and long-term profitability.

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SEATTLE, Feb. 20, 2025 /PRNewswire/ -- While recent first-time home buyer rates have declined nationally, Black buyers have experienced the strongest rebound. A recent Zillow® survey found that 62% of Black home buyers purchased their first home in 2024, holding steady from the previous year. In comparison, overall, first-time buyers made up just 44% of the market, down from 50% in 2023. After a sharp drop from 47% in 2019 to 35% in 2021, the share of Black first-time buyers rebounded to 55% in 2022 and hit a record 63% in 2023 — outpacing other racial groups and the national trend. "Despite affordability challenges, Black first-time home buyers are demonstrating a strong commitment to homeownership, a key driver of generational wealth," said Zillow Senior Economist Orphe Divounguy. "While income disparities and saving difficulties continue to delay home buying for Black households, programs like down payment assistance, first-time buyer tax credits and flexible lending options have helped increase access." The rise of remote work has also expanded opportunities, giving some Black renters more flexibility to pursue homeownership in more affordable areas. Zillow research shows that Black renters are 29% more likely than other renters to be at a tipping point where remote work could make homeownership achievable. Still, high housing costs and strict building regulations in many metropolitan markets limit opportunities for many buyers across the country, disproportionately impacting lower-income households — particularly Black households and other households of color. These areas often face supply constraints that drive up prices, and in markets with stricter building regulations, even fewer listings are affordable for the typical Black household. A key measure of housing affordability is the monthly housing burden compared to household income. Black households face the steepest barriers, earning a median income of $54,896 — far below the $95,213 needed to buy the typical U.S. home in 2024 without being cost-burdened (spending more than 30% of income on housing). As a result, just 17.6% of listings are affordable for the typical Black household, compared to 28.2% for Hispanic, 37.9% for white, and 56.8% for Asian households, underscoring persistent gaps in homeownership. St. Louis is the most affordable1 housing market for typical Black households — those households earning the median income — with 30.3% of listings within reach in 2024. Birmingham follows at 29.5%, and Memphis at 29.0%. Other affordable markets include Detroit (28.6%), Baltimore (25.8%), Pittsburgh (23.7%), Cleveland (22.8%), Indianapolis (22.0%), Atlanta (19.2%) and Oklahoma City (18.8%). In contrast, the least affordable markets for potential Black home buyers are concentrated on the West Coast, including major California metros and Seattle. Despite a steeper decline in the share of home listings that were affordable to the median earner, Black homeownership increased more than white homeownership in 2024 compared to 2019.  Only Hispanic households saw a higher percentage increase in homeownership. Black first-time home buyers are driving homeownership gains, but barriers remain. Zillow, a leader in real estate and technology, is helping to tackle some of these challenges through innovation and advocacy. Zillow Home Loans' BuyAbility℠ tool gives buyers real-time, personalized insights on how interest rates impact their budget, showing estimated monthly payments and helping them find homes on Zillow that are within their price range. Zillow's down payment assistance tool connects buyers with financial resources through a simple questionnaire and dedicated page. Beyond technology, Zillow advocates for policies that expand credit access, boost housing supply and improve affordability. Metro Typical Home Value (Based on Zillow Home Value Index (ZHVI), December 2024 ) Typical Monthly Mortgage Payment Household Income Needed to Afford Monthly Mortgage on a Typical Home Share of Affordable Listings for Black Households (%) Share of Affordable Listings for White Households (%) Median household income overall (by metro) Median Household Income (Black Households) Median Household Income (White Households) United States $354,711 $2,380 $95,213 17.6 % 37.9 % $75,301 $54,896 $85,970 New York, NY $674,000 $4,825 $192,987 4.5 % 19.9 % $79,445 $67,844 $78,305 Los Angeles, CA $950,210 $5,989 $239,554 0.4 % 5.0 % $77,684 $64,322 $78,823 Chicago, IL $321,071 $2,423 $96,935 11.4 % 51.1 % $74,576 $51,789 $111,865 Dallas, TX $369,035 $2,670 $106,805 7.2 % 35.5 % $68,092 $64,219 $82,655 Houston, TX $305,539 $2,128 $85,120 14.3 % 52.4 % $79,237 $60,055 $88,042 Washington, DC $566,740 $3,742 $149,681 15.3 % 50.5 % $71,469 $90,113 $87,213 Philadelphia, PA $360,070 $2,511 $100,434 15.2 % 53.8 % $94,463 $54,482 $83,898 Miami, FL $483,889 $3,448 $137,902 12.4 % 26.4 % $70,899 $61,111 $78,150 Atlanta, GA $377,128 $2,602 $104,087 19.2 % 48.2 % $80,791 $72,194 $79,237 Boston, MA $687,322 $4,570 $182,814 3.6 % 18.4 % $98,192 $77,684 $103,578 Phoenix, AZ $450,312 $2,760 $110,411 3.8 % 23.6 % $71,345 $61,111 $95,292 San Francisco, CA $1,129,853 $7,220 $288,815 0.9 % 14.6 % $88,767 $72,505 $98,814 Riverside, CA $582,400 $3,768 $150,730 5.8 % 12.5 % $66,539 $74,887 $100,782 Detroit, MI $246,782 $1,735 $69,412 28.6 % 59.6 % $93,220 $47,646 $78,305 Seattle, WA $732,246 $4,762 $190,462 2.2 % 13.8 % $71,883 $77,684 $88,042 Minneapolis, MN $364,854 $2,581 $103,238 9.7 % 47.8 % $88,042 $61,111 $101,507 San Diego, CA $932,386 $5,864 $234,569 0.6 % 6.0 % $80,170 $75,198 $148,117 Tampa, FL $367,868 $2,536 $101,445 12.3 % 24.2 % $124,294 $61,111 $103,578 Denver, CO $578,402 $3,682 $147,269 3.9 % 24.0 % $85,970 $64,219 $100,802 Baltimore, MD $383,897 $2,562 $102,481 25.8 % 59.6 % $80,791 $67,326 $82,863 St. Louis, MO $248,944 $1,794 $71,756 30.3 % 61.5 % $79,237 $48,889 $88,249 Orlando, FL $389,796 $2,654 $106,159 12.7 % 25.2 % $79,755 $66,290 $99,435 Charlotte, NC $376,608 $2,406 $96,252 9.8 % 41.1 % $78,927 $56,968 $84,934 San Antonio, TX $279,985 $1,935 $77,384 17.1 % 46.4 % $73,541 $59,040 $76,648 Portland, OR $540,758 $3,578 $143,126 3.2 % 14.1 % $88,042 $62,147 $87,627 Sacramento, CA $574,042 $3,739 $149,574 2.5 % 12.5 % $97,156 $70,640 $92,703 Pittsburgh, PA $209,684 $1,503 $60,103 23.7 % 60.1 % $81,620 $41,431 $106,893 Cincinnati, OH $281,154 $1,842 $73,686 17.8 % 59.0 % $63,493 $48,319 $83,898 Austin, TX $442,669 $3,034 $121,370 6.1 % 30.3 % $79,507 $74,576 $100,471 Las Vegas, NV $428,628 $2,653 $106,107 7.0 % 20.5 % $99,435 $58,004 $85,970 Kansas City, MO $298,143 $2,102 $84,077 17.8 % 52.0 % $88,042 $51,789 $104,821 Columbus, OH $310,104 $2,206 $88,221 12.8 % 47.2 % $73,541 $51,789 $92,703 Indianapolis, IN $272,544 $1,846 $73,842 22.0 % 59.1 % $77,684 $54,171 $90,735 Cleveland, OH $225,119 $1,654 $66,159 22.8 % 59.9 % $78,720 $41,431 $85,245 San Jose, CA $1,607,357 $10,002 $400,078 0.1 % 5.9 % $87,109 $90,113 $77,684 Nashville, TN $440,417 $2,793 $111,709 3.4 % 26.9 % $104,614 $58,025 $112,900 Virginia Beach, VA $347,993 $2,361 $94,454 8.5 % 53.6 % $84,209 $53,861 $91,563 Providence, RI $477,077 $3,246 $129,856 4.7 % 16.7 % $76,648 $61,733 $82,867 Jacksonville, FL $348,956 $2,495 $99,794 11.4 % 34.1 % $94,774 $55,932 $116,318 Milwaukee, WI $341,543 $2,694 $107,775 10.5 % 41.8 % $113,936 $43,710 $123,258 Oklahoma City, OK $229,767 $1,681 $67,227 18.8 % 46.1 % $113,522 $51,789 $99,435 Raleigh, NC $436,744 $2,864 $114,573 4.9 % 41.0 % $96,846 $65,254 $91,149 Memphis, TN $232,491 $1,633 $65,337 29.0 % 59.5 % $84,934 $50,753 $148,117 Richmond, VA $368,933 $2,429 $97,178 13.8 % 52.4 % $96,535 $62,665 $98,296 Louisville, KY $255,717 $1,707 $68,298 14.1 % 55.6 % $129,473 $43,089 $113,936 New Orleans, LA $234,078 $1,684 $67,370 9.1 % 47.4 % $89,077 $41,431 $102,646 Salt Lake City, UT $541,465 $3,373 $134,936 16.7 % 17.9 % $96,949 $98,399 $93,220 Hartford, CT $360,289 $2,663 $106,511 17.4 % 46.7 % $157,025 $70,433 $113,833 Buffalo, NY $254,148 $2,023 $80,926 13.4 % 52.0 % $104,511 $41,431 $155,367 Birmingham, AL $246,545 $1,610 $64,405 29.5 % 54.7 % $93,220 $52,825 $109,793 *Table ordered by market size About Zillow Group: Zillow Group, Inc. (Nasdaq: Z and ZG) is reimagining real estate to make home a reality for more and more people. As the most visited real estate website in the United States, Zillow and its affiliates help people find and get the home they want by connecting them with digital solutions, dedicated partners and agents, and easier buying, selling, financing, and renting experiences. Zillow Group's affiliates, subsidiaries and brands include Zillow®, Zillow Premier Agent®, Zillow Home Loans℠, Zillow Rentals®, Trulia®, Out East®, StreetEasy®, HotPads®, ShowingTime+℠, Spruce®, and Follow Up Boss®. All marks herein are owned by MFTB Holdco, Inc., a Zillow affiliate. Zillow Home Loans, LLC is an Equal Housing Lender, NMLS #10287 (www.nmlsconsumeraccess.org). © 2025 MFTB Holdco, Inc., a Zillow affiliate. 1 Affordability is based on total monthly costs — taxes, insurance, and maintenance — with a 20% down payment and mortgage costs under 30% of income, as of 2024. SOURCE Zillow

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