Global Business Council virtual presentation, John Wong, founding chairman of the Asian Real Estate Association of America, shared valuable information about homeownership among subgroups of the Asian American community. Originally regarded as AAPI month, Wong said the Biden administration has designated May as "Asian American, Native Hawaiian, and Pacific Islander Heritage Month" to bring broader visibility to Native Hawaiian and Pacific Islander communities and their unique needs.
Wong said the AANHPI community has a buying power of $1.3 trillion, which is larger than the annual GDP of all but the top 13 countries. On a per capita basis, Wong said this is significant because it translates to a growing consumer base in housing, luxury and other markets.
From 2010-2020, AANHPI buying power grew 111% outpacing other minority groups. The group's 2020 median household income of $94,903 outpaced that of Hispanics ($55,321), Blacks ($45,870), and Whites ($71,231).
With nearly 21 million people, AANHPI represents 6.3% of the country's population. This segment of the population has consumer markets across the country with a growing demand for Asian consumer products. California has the largest AANHPI market accounting for $439 billion.
"This shows the AANHPI segment is small but mighty," said Wong. He indicated the AANHPI population is projected to reach 46 million by 2055.
Before President Johnson signed the Fair Housing Act of 1968, Wong said many states forbade people of color from owning, renting or living in any property in certain areas for as long as 50 years. In some cases, they could live in the area but only as servants or employees hired by a Caucasian or White person.
While the AANHPI community has come a long way since then, barriers to homeownership still exist. Wong said along with discrimination are cultural perceptions. Asians traditionally place a high priority on education of their children and financial stability and security, so they prefer to rent than buy until these goals are met. They are also suspicious of adjustable rate mortgage loans and once they purchase a loan, they pay it off sooner than later. Others don't understand the loan process.
AREAA's State of Asia America 2023-2024 report, compiled by members of AREAA's 44 chapters around the country, includes detailed information on homeownership rates and incomes by subgroups in different regions of the country. The report found Asian Indian Americans, the subgroup with the highest income, does not have the highest homeownership rate. Vietnamese Americans have the highest homeownership rate despite not having the highest income among the subgroups. These findings show not all Asian Americans are the same.
"It is important to disaggregate the AANHPI groups because they are as varied as their foods and have different needs," said Wong.
Wong did note that like all other groups, including Whites, the AANHPI workforce struggles with housing affordability. "We need to focus on housing affordability programs for this sector of the population," he said.
Asian Americans also impact the global economy, said Wong. China, India and Japan are among the top countries of origin of foreign buyers of U.S. real estate. He mentioned globally many governments restrict the flow of citizens from certain countries, including China and India.
"There's a wave of new legislation by states underpinning successes of fair housing by banning foreigners from certain countries, particularly China, from purchasing real estate," said Wong. "It's happening in Florida, Texas and 32 other states."
While the purpose of these laws is to protect national security, Wong warned discrimination against a subset group based purely on their national origin could affect sales to Chinese American and other Asian American people who are legally living in the country.
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