Housing Industry Awakens to the Latino Market
 Home Builders Take Steps To Make Buying Easier For Hispanic Prospects
By ILAN BRAT
FORT WORTH, Texas -- A full-size glass house complete with furniture sits
inside the La Gran Plaza mall here, right next to the Cinema Latino and a
Spanish-speaking income-tax preparer. Developers Andrew and Justin
Segal are using the see-through house to target Hispanics daunted by the
home-buying process.
"The idea is that someone could walk in there who might not be the target
of a new-house market, and everything is kind of there for them to see,"
says Andrew Segal, whose company just began building homes for as little
as $105,900 a few minutes' drive from the mall.
Hispanics account for one in 10 households in the U.S., but until recently
the housing industry gave them short shrift.
No longer. Home builders are loosening their credit standards to accept
Hispanic home buyers who don't have long credit histories or who depend
upon multiple paychecks to pay the mortgage. They're building homes to
house extended families. The Segal brothers' company, CasAlegria, is in
the process of translating into Spanish all the documents needed to buy a
home.
In the first quarter, 49% of Hispanic
families owned homes, up from 41%
in 1994. Still, that is well below the
69% homeownership rate for the total
U.S. population, and the housing
industry is looking for Hispanic
homeownership to keep rising.
"The rabbit moving through the
python in the housing industry is the
growth of Latino and immigrant
families," says former Housing and
Urban Development Secretary Henry
Cisneros, now chief executive of
American CityVista, which targets
low-income customers. Mr. Cisneros's
firm has sold 2,050 homes since it
partnered in 2000 with KB Home, one
of the country's largest home builders.
Strong demand for housing from immigrants of all nationalities is one
reason why home prices have been rising so briskly in the U.S. Some of the
fastest gains have come in communities like Los Angeles, Miami or New
York that are beacons to immigrants from all over the world. The growing
demand from first-time Hispanic home buyers, many of them with lower
incomes, is pushing up home prices in once-decaying neighborhoods.
Builders are making other changes to lure immigrants with large families.
Griffin New Homes' 160-unit Coronado Square subdivision in Riverside,
Calif. -- where up to 25% of home buyers are Hispanic -- offers houses that
combine the living room and family room into one great room, perfect for
family gatherings. Almost all of Montage Neighborhood Builders' homes in
California include downstairs bedrooms and bathrooms for grandparents.
Countrywide Home Loans Inc. started a program in 2004 that gives loans
with no down payment to someone who can present a year's worth of utility
bills, rent or even cable television payments. The program is well-suited for
the Hispanic market, says Mary Salinas Duron, Countrywide executive vice
president of national multicultural markets. "Because they do business
slightly differently, it doesn't mean their loan becomes riskier," she says.
Creative financing helped Rodolfo Castro and his family move into a new
Dallas home in April. He'd wanted to move out of the house he was renting
for some time, but he had no credit record. Then he showed a local lender
two years of cellphone, utility, rent and cable payments and secured the
financing for his new four-bedroom, $112,000 home in a Casas Modernas
development in east Dallas. Now he owns the brick house on a street full of
three- and four-bedroom homes shoehorned onto tiny lots.
"It's for my children's better future," says Mr. Castro as he stands by a
newly planted tree in his front yard. "I only had to get the money."
CasAlegria, the company with the glass house in the mall, is making its first
home building push with 14 homes on approximately 7,000-square-foot lots
in Forest Hill, a city of 13,000 near Fort Worth. CasaAlegria is trying to keep
home prices down by excluding fireplaces and building the houses on
inexpensive land farther back from a major thoroughfare. Still, even that
puts the homes beyond the reach of many Mexican-Americans.
Gustavo Angeles, who loads trucks for a food distributor, saw his credit
application turned down recently by CasAlegria. His was the only income in
the family, and his salary wasn't sufficient for the $105,900, four-bedroom
home that he craved.
"Sure, I could imagine myself in a house like that," says Mr. Angeles as he
walks away from the glass house.
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