<i> Casa, </i> Sweet <i> Casa</i> : Latino Home Buyers Are the Fastest-Growing Group in the Los Angeles County Real Estate Market

By STEPHANIE O’NEILL

Dec. 4, 1994 12 AM PT

SPECIAL TO THE TIMES

Theresa Arreguin, a newlywed schoolteacher from El Sereno, considers homeownership to be insurance against the hassles of renting, which she saw her parents endure in the years since they immigrated from Mexico to Los Angeles.

Tony Garcia, 28, a married Glendale father of two young boys and two stepsons, says homeownership--a goal he set for himself as a child--has laid the foundation for economic security for his young family.

Emilio Lopez of Highland Park says he also realized the significance of owning a home when he was just a small child, newly immigrated to Los Angeles from Guatemala.

The move to this country required that his family exchange their landowner status for that of immigrant renters. Today, however, both he and his parents own their own homes here. “It’s unbelievable,” said Lopez, who is 31. “It’s like a dream come true.”

And it’s a dream coming true these days for more and more Latinos, now the fastest-growing group of home buyers in the Los Angeles County real estate market.

But for Arreguin, Garcia and Lopez, and for many other Latino home buyers, owning a home is much more than just having a place to call their own.

“When your parents come here, you see the struggles, the difficulties, the barriers with the language and it takes you a long time to get out of that stage,” said Arreguin, 29, who as a young child immigrated with her parents from Mexico.

“For me, I knew I had to get into a home as soon as I could because that’s the only way out, that’s the only way to have something for the future.”

Garcia agreed: “You buy a home to have something secure in the future for yourself and for your children.”

Throughout Los Angeles County those sentiments, along with favorable economic conditions and changing demographics, have helped fuel a buying binge among Latinos that has made them the most prevalent home buyers in Los Angeles.

Latinos account for nine of the 10 most common surnames of new home buyers so far this year, according to La Jolla-based Dataquick Information Systems.

The name Garcia was No. 1 on the list. Gonzalez and Rodriguez followed at No. 2 and No. 3, respectively. (See accompanying chart.)

By comparison, in 1989, the name Lee was the most common, with Kim and Smith in second and third places, respectively. Back then, Garcia placed 10th and was the only Latino name on the list.

Based on a survey of common Latino surnames, the number of Latino buyers in Los Angeles County has climbed nearly 40% since 1989, according to Dataquick.

The increase is due in large part to the sheer number of Latinos in the region, said Fernando Guerra, a political scientist and director of Chicano Studies at Loyola Marymount University in Los Angeles.

“Demographics show a tremendous surge in Latino immigrants (to Los Angeles),” Guerra said. “About 40% of L.A.’s population is Latino, so they’re going to make up a larger part of the market.”

Latino immigration coupled with a decline in domestic migration of Anglos to California has left a larger share of the home-buying pie to Latinos, said Dowell Myers, a demographer and associate professor of urban and regional planning at USC.

“When domestic migration returns to California, we’ll see the Garcia name drop back--not to No. 10, but to 5 or 6,” Myers said.

“But Latinos will retain many of the gains they made during this recession and over the next decade or two. They will become a permanent factor in the housing market.”

Beyond demographics, other issues also have boosted home sales among Latinos, observers say.

The crash in Southland real estate prices played an obvious role in enabling Latinos to enter the local housing market in larger numbers. Most Latino purchasers were first-time buyers of homes in the mid-$100,000 range, which the soft market kept in plentiful supply.

Further, the recession-fueled paralysis that’s afflicted many potential home buyers appears to have bypassed Latinos, who seem less apprehensive about California’s economic malaise, those in the real estate industry say.

“They’re usually not dissuaded by economic indicators whether (home) prices are falling or going up,” Jaime Shimabukuro, a mortgage consultant with Covina-based Occidental Mortgage, said of Latinos buyers, who make up about 90% of all his clients. “Pretty much, once they can afford it, they go in there and buy.”

“They are recession-proof,” said Federico Triebel, branch manager of Pacific West Bankcorp, a mortgage company in Burbank. “There is a resiliency among Latino buyers and most of it is cultural. They get together and help each other.

“When they buy a property, they’re not thinking that in the next month or next six months that they might lose their job or be displaced. . . . In the event they have a problem, they (often) move in another member of the family.”

Latinos also appear more willing to join with family and friends initially to make a home purchase possible, observers say. That factor combined with an increased willingness by lenders to make such multiple-party loans, has opened up more buying opportunities among Latinos.

“Sometimes you’ll have two couples who buy a three- or four-bedroom home,” said Maria Camerena, a realtor for Century 21 Arroyo Seco in Los Angeles, who made nine of her 14 sales this year to Latinos. “Usually the intention is to stay together for a couple years until the other couple can buy them out.”

Rose Noriega plans on temporarily sharing ownership of her two-bedroom, one-bath Montecito Heights home she bought with a friend, and now roommate, for $130,000 last May.

“I had been wanting to buy a house for the past three years, but I couldn’t do it on my own,” said the 34-year-old payroll company employee. “This was just a wonderful opportunity.”

Noriega, who hopes to buy out her friend in a year, said her parents’ experience with homeownership was etched into her consciousness at an early age.

For them, she said, homeownership was a “ticket out” of many of the difficulties they faced as Mexican immigrants. “I saw that it would help me tremendously to be a property owner,” she said.

Emilio Lopez agreed. The Highland Park resident bought his first home in April. Lopez’ parents helped him qualify to buy the $105,000 two-bedroom, one-bath home with a back-yard Jacuzzi. His new lifestyle is markedly different from his early childhood. Back then, his parents were renters who could afford little.

“We were living in apartments that were really bad,” said Lopez, an administrative assistant for the Los Angeles County Department of Health Services. “All these years here, deep down inside I felt alienated. . . . I felt that we weren’t being treated with the respect we had gotten before (in Guatemala) and it was very important to me.”

By the time he was a teen-ager, Lopez persuaded his family to sell property they owned in Guatemala so that they could buy their own house in Los Angeles, which they did. Lopez said his family is now convinced that homeownership is essential to a better standard of living.

“You have dirt that you can grab and feel that it’s your land. It’s a very wholesome thing that’s tied to the whole philosophy of the Hispanic,” Lopez said of homeownership. “It reaffirms all your beliefs in yourself and your self-esteem. You have that much more right to demand your rights, and people treat you with respect.”

Theresa Arreguin and her husband, Gregorio, 30, recently helped Arreguin’s mother buy her first home by co-signing the loan.

She helped her mother buy the two-bedroom, one-bath home in El Sereno just a year after Arreguin and her new husband bought their first home two blocks away.

“I was living with her until I got married,” said Arreguin. “And when I got married, I knew I had to get something for her. I saw my parents go through the struggles with (renting). And not having your own home when you’re 50 or 60, it’s scary.”

Tony Garcia said that buying his house in Glendale for $140,000 gave him a sense of accomplishment he hasn’t before experienced.

“My parents never owned any property,” said Garcia, a computer technician. “But when you buy your own house--your own private land--you can do whatever you wish. It gives you a sense of freedom.”

The quest for stability and the hope that a house will appreciate in value to provide economic security are foremost among many new Latino home buyers, Camerena, the Century 21 realtor, said.

“They feel (homeownership) is the best security, even though homes are going down in price,” Camerena said. “They feel if they hang in there five or 10 years, the equity will be there.”

Armida Hernandez, 31, and Oscar Hernandez, 35, of Los Angeles said they had their 5-year-old son in mind when they recently purchased a second home in Montecito Heights, two doors away from Noriega.

“We’re trying to provide some kind of future for our son so that maybe when he goes to college he’ll have something he can sell to cover his expenses,” Armida Hernandez said.

“Every single penny we have has gone into buying these homes, but my family and Oscar’s family have always believed you’ve got to provide for your children and a house is a good way to provide.”

Another key reason for the surge in Latino home buyers in the 1990s was more flexible lending standards brought about by the recession and by a changed political climate. Many Latinos, as well as other minority and low-income buyers, in the past often found it extremely difficult to get a home loan.

“When houses are moving quickly (lenders) tend to be stricter on their lending policies,” Shimabukuro said. “Now (in a much weaker market) they’re willing to be more creative and more relaxed.”

Further, a Clinton Administration directive to beef up the 1977 Community Reinvestment Act (CRA), the nation’s major anti-discrimination law in lending, has opened new home-buying opportunities to minorities.

And the strict loan reporting standards required by the Home Mortgage Disclosure Act (HMDA), enacted by Congress in 1975 and expanded in 1989, has focused more attention on fair-lending practices.

HMDA requires lending institutions--including many independent mortgage lenders--to disclose the characteristics of loan applicants and recipients.

HMDA reports, which are available to the public, assist enforced compliance with anti-bias statutes by helping to identify discriminatory lending patterns.

The push to increase minority lending has also gotten help from the country’s two major providers of mortgage funds, who play a large role in shaping the policies of local lenders.

The Federal National Mortgage Assn. (Fannie Mae) and the Federal Home Loan Mortgage Corp. (Freddie Mac), both quasi-governmental agencies, buy home loans on the secondary market and package them as Wall Street securities. This financial clout gives them lots of influence over local banks, S&Ls; and mortgage bankers and brokers.

Through these local lenders, Fannie Mae offers its Community Homebuyer program and Freddie Mac its Welcome Home loan program aimed specifically at putting home ownership within reach of low-income residents.

And with this backing from Fannie and Freddie, many more lenders are actively soliciting minority applicants.

This new eagerness among lenders to make minority home loans has proven important to Latino home buyers, many of whom don’t earn and spend in the same way as other ethnic groups.

A large number of Latinos, for instance, save cash “under the mattress,” or outside of traditional bank accounts, lenders say. Often times, they have little or no credit history.

“There are a lot of false perceptions about low- to moderate-income people,” said Mario Antoci, chairman of the board and chief executive officer of Irvine-based American Savings Bank, one of the largest lenders to minorities.

“The perception is that they’re always delinquent (with payments), that there would be a high foreclosure rate. Well, it doesn’t work out that way,” he said. “Turns out that perhaps the lower the status, from an economic standpoint, the more important the home is to you. The more you’ll do to protect that home.”

Antoci said American’s foreclosure rates in low- to moderate-income neighborhoods are “substantially” below that of more affluent areas.

Gloria Ancira, director of the Home Loan Counseling Center, which serves predominantly Latino Lincoln Heights and South-Central Los Angeles, said that with the proper preparation, clients with no credit, those with credit blemishes and even those who deal all in cash can usually get a loan.

“Lenders are so lenient that they’re accepting a lot of those (applicants) that they didn’t before,” she said. “But (clients) do have to be very frank and open with their loan agent or broker.”

Those with bad credit usually need to write letters of explanation and, if necessary, pay whomever they owe money to, she said. For those who deal only in cash, banks are beginning to accept grocery store receipts and paid utility bills in lieu of conventional paycheck stubs, bank records and credit histories.

“We’ve learned to deal with the realities of the cultures we’re trying to do business with,” Antoci said. “We won’t make a loan to somebody if there’s not at least one W-2 in the group, but we will accept a portion coming from cash sources.”

As lending institutions begin to institutionalize this new criteria, it makes the future housing market more accessible to Latinos as well, said Fernando Guerra, of Loyola Marymount University.

And, Guerra said, the increase in Latino home buyers will prove to be a “positive force” for all of the Southland.

“As renters, it’s hard for the Latino community to create residential stability,” he said. “When you have residential stability, you have people engaged in the community. In terms of politics, you have high voter registration and turnout. You have people who are less tolerant of criminal or anti-social behavior in a neighborhood where they own the property.”

Emilio Lopez, of Highland Park, said he is still ecstatic about his new home purchase.

“Privacy is very important to us,” he said of Latinos. “We enjoy having a house with trees, land. It’s more important to those who come from the native lands. When you go through the hustle and bustle of L.A., (a home of your own) is a place to recycle your energy and build your inner peace.”

O’Neill is a Los Angeles free - lance writer.

Home Sales by Surname

Here are the most common surnames of L.A. County home buyers, the number of homes bought by each group name and the average price so far this year.

Rank/name No. Ave. price 1. Garcia 524 $162,739 2. Gonzalez 431 $147,738 3. Rodriguez 420 $154,492 4. Hernandez 403 $145,000 5. Lopez 395 $148,210 6. Martinez 371 $151,814 7. Lee 349 $293,248 8. Ramirez 287 $155,548 9. Perez 283 $152,737 10. Sanchez 274 $141,955 11. Smith 273 $223,410 12. Kim 232 $280,615 13. Johnson 213 $219,964 14. Gomez 193 $172,363 15. Flores 169 $158,576 16. Williams 167 $240,042 17. Chen 164 $309,175 18. Chavez 155 $151,915 19. Gutierrez 155 $154,820 20. Jones 151 $231,724 21. Torres 151 $166,681 22. Diaz 144 $160,230 23. Brown 137 $230,921 24. Alvarez 129 $145,055 25. Davis 129 $243,265

Source: Dataquick Information Systems, La Jolla .