What Lenders Can Learn From The Rise In Hispanic American Homeownership

Among the current trends in homebuying, one stands out as particularly encouraging: Hispanic Americans are buying homes at a higher rate than ever, more Hispanic Americans own homes than ever before, and this growth rate is currently the highest of any racial or ethnic group.

As these buyers connect with mortgage lenders around the country, they do so under the simultaneous pressures of rate volatility and affordability issues, both requiring lenders to adapt and evolve in the face of customer needs.

It’s a steep challenge, but it’s also an opportunity: Hispanic Americans are displaying historic readiness to find the right lender and make their homeownership dream a reality. But without the right customer education and engagement strategies, lenders risk letting this opportunity go to waste.

Mortgage lenders need to meet the moment. How? By addressing the unique needs of Hispanic American homebuyers with an empathetic, strategic approach to outreach and communication –– one that builds trust through continuous, personalized engagement.

Here’s how to make that happen.

A closer look at the trend (and what it means for lenders)

The rise in Hispanic American home ownership has a rich backstory.

Ongoing demographic momentum, combined with improved economic conditions within the community, on average, have fueled a sustained uptick. Young Latino families in particular are contributing to this trend as they look to forge stability, support long-term financial growth, and create a space for building their families.

In 2024, Hispanic homeownership reached a record 9.8 million households, with 238,000 new households formed last year alone.

For mortgage lenders, this trend represents a significant opportunity to connect with a fast-growing subset of potential customers while also offering personalized advice and education to a group that, historically, has lagged behind other demographics in terms of homeownership. Especially in regions with high populations of Hispanic Americans, lenders have a unique chance to support an underserved market.

However, this is easier said than done.

Hispanic American homebuyers are obviously not a monolith. They’re a diverse set of buyers and households with varying financial needs. To best serve this market, mortgage lenders need to invest more in their outreach and customer engagement strategies with tailored communications that support the development of strong, authentic customer relationships.

Embracing an empathetic, strategic approach

Relating to your customer isn’t a novel concept –– it’s sales 101. But developing this empathetic approach is often easier said than done. Especially when it comes to purchases as significant as a house, it’s critical to ensure that your understanding of your target demographic is thorough and authentic.

Some lenders make the mistake of limiting their outreach strategy to “token” hiring of a few Hispanic American sales associates. Hiring from within target communities can, in certain cases, contribute to better one-on-one relationships based on shared values and similar backgrounds. But in practice, restricting your approach to a few token hires falls far short of what a truly successful strategy requires: full institutional buy-in that considers the specific needs of the target demographic and addresses them throughout the customer journey.

Other lenders make the mistake of limiting their outreach with prospects and current customers to rigid, generic communications. Not only do these outreach strategies fail to deliver on hyper-personalized communications (increasingly a table stakes customer expectation), but they also fail to seize on opportunities to build trust and nurture relationships in the long term.

Your outreach must combine empathy with strategy. It takes a genuine, comprehensive approach to understand and meet the needs of your target audience — needs that must be considered against the backdrop of the entire customer journey. Analyzing your funnel in this way reveals cracks and breakdowns that prospective and current customers are slipping through. It also helps you find a better path forward.

For example, a prospect may be interested in homeownership in the abstract. The prospect may be ready to start a family and begin building wealth, and through their cursory online research and the real estate referral pipeline, their information winds up in the hands of a lender (you) who initiates an outreach cycle.

If their homebuying journey is stalled by affordability issues, as is the case with many current homebuyers, they won’t be responsive to generic offers and communications. Eventually, the prospect falls off your radar. Later, when the prospect is financially ready to make a move, they’ll partner with another lender, and you’ll lose the sale.

On the other hand, if the prospect receives ongoing, customized communications that continue to engage them –– with, for example, financial literacy resources on building credit, eliminating debt, and growing savings –– the prospect will have spent the runup to their big purchase slowly building trust with you. When the prospect is ready for their mortgage, you’ll already be their no. 1 choice.

Even in more “traditional” situations, customers require nurturing. On the other side of COVID-19, the average homebuying cycle has risen from 3-6 to 6-9 months, if not longer. To stay competitive, it is crucial that lenders keep customers continuously engaged with communications and resources that speak to their specific needs.

Strengthening outreach with the right tools

Some lenders might read my advice in the previous section and wonder, “How exactly am I supposed to do all this? I don’t have a massive army of sales associates or a bottomless tank of resources –– how am I supposed to deliver on this level of personalization and continuous outreach?”

Modern customer engagement solutions make it possible. With the right technology partner, mortgage lenders can multiply the efficacy and authenticity of their outreach by using tools that tailor customer journeys according to highly specific, targeted criteria.

When choosing the right partner, lenders should look for three core features:

1. Automated journeys: Marketing and sales teams can build out omnichannel customer journeys that leverage automation to continuously nurture customer relationships without the need for human intervention or coding knowhow.
2. Heightened data intelligence: In addition to a 360-degree view of customer data across your database, the right tool will enable a deeper look into customer intent signals (getting married, changing jobs, etc.) that can set off customized outreach flows.
3. Advanced customization: Communications can be highly customized based on language preferences or self-identified level of financial literacy for maximum impact.

Better outreach. Better relationships. Better business.

More and more Hispanic Americans are achieving their dream of homeownership. Mortgage lenders have an unprecedented opportunity to play a critical supporting role in this inspiring story –– and drive better business in the process.

But seizing this opportunity requires mortgage leaders to take a long, hard look at how their customers’ needs align with their customer journeys. Without an empathetic, strategic approach to nurturing customer relationships, mortgage lenders risk letting a generational windfall slip between their fingers.