Name of Report: Business Plan: A Proposal for a Rhode Island Home Center
Organizational Affiliation: State of Rhode Island Housing Resources Commission Office of Homeownership and the Federal Reserve Bank of Boston
Author: N/A
Contact Information: 41 Eddy St. Providence, RI 02903
Date: March 2001
Pages: 25
Content Summary
This report is divided into six parts. The first part provides the mission of the Rhode Island Home Center: “to provide, on a statewide basis, services and training for prospective and existing homeowners to: shop for, qualify for, purchase, retain, rehabilitate, insure, maintain, and manage a home.” There is also an extensive market analysis of the target population for these services, which are low- to moderate-income and minority households. The remainder of the report is largely concerned with the logistics of operating, financing, evaluating, and structuring a Home Center.
Major Findings
The market analysis based on 1990 Census data indicates that minority households are concentrated in low- to moderate-income communities in Rhode Island. For example, 84% of the minority population in Providence live in a low- to moderate-income communities. The report also finds that the disparity in obtaining financing by families of color is a growing problem in Rhode Island. Furthermore, significant increases in subprime lending to minority homeowners in Providence put them at an increased risk of equity loss. The Appendices contain tables with a large amount of data on housing in Rhode Island. Tables of interest include: “African-American Denial Rates for Government-Backed Purchase Loans,” “Greatest Disparity Between Latino and White 1999 Denial Rates for Government-Backed Loans”, and other related data sets.
Related Issues
The Office of Homeownership presents evidence of a pressing need for a Home Center in Rhode Island. However, the proposal could be made more compelling by showing how the services provided by the Home Center would serve the specific needs of the target population. Recent reports examining home financing concerns in minority populations can aid in efforts to highlight underlying problems in this sector that contribute to racial disparities in housing. A 2002 report points out inconsistencies in Federal Housing Administration-insured mortgage activity, which is intended to increase homeownership rates in minority-populated areas, among others (Önder). A 2004 report explains how recent financial transformations of the U.S. credit market have created disparities in home mortgage finance ability between Black/lower-income families and White/higher-income families, and recommends public programs that will equalize home finance ability across socioeconomic groups (Zhou & Shaw). Another report examines homeownership and poverty status among Asian immigrants, a population that is often overlooked in related research on ethnic minorities (Kwon et al.).
Reference List
Kwon, Hee-Kyung, Virginia S. Zuiker, and Jean W. Bauer. “Factors Associated with the Poverty Status of Asian Immigrant Householders by Citizenship Status.” Journal of Family and Economic Issues 25.1 (2004): 101-120.
Önder, Zeynep. “Homeownership and FHA Mortgage Activity in Neighborhoods and Metropolitan Areas.” Journal of Housing Economics 11 (2002): 152-181.
Zhou, Bin and Wendy Shaw. “Financial Transformation and Portfolio Reallocation: Impacts on House Mortgage Finance in the USA.” Housing Studies 19.2 (2004): 207-228.
How to Access Report
Contact Ray Neirinckx, rneirinckx@rihousing.com