Disparities in mortgage approval rates and higher student loan debt are contributing to a significant gap between Black and white home owners, according to the National Association of Realtors.

NAR put together its “Snapshot of Race and Home Buying in America” report to study the hurdles that persistently block minorities from owning homes. The report used American Community Survey data spanning from 2009 to 2019. The numbers showed that the overall U.S. home ownership rate was 64.2%. At 69.8%, the home ownership rate for white Americans far surpassed that of other groups. Black Americans owned homes at a 42% rate. The numbers were stronger for other minority groups, with ownership rates of 48.1% for Hispanic Americans and 60.7% for Asian Americans.

Nationally, the strong residential housing market during the pandemic generated approximately $1 trillion in additional home equity for homeowners over the past year, NAR chief economist Lawrence Yun said in a press release.

“However, as indicative of the K-shaped economic recovery, greater numbers of potential first-time homebuyers – many of whom are minorities – are feeling discouraged by disproportionate job losses,” Yun said. “Essentially, they’re being priced out of owning a home because of rapidly rising home prices resulting from historically-low housing inventory. For Black Americans, in general, the greater likelihood of having student loan debt, combined with lower household incomes and accrued savings when compared to the national average, adds to the challenge.”

Nationwide, 43% of Black households can afford to purchase the typical home compared to 71% of Asian households, 63% of white households and 54% of Hispanic households. Borrowing was more difficult for Black Americans, 10% of whom were rejected for mortgage loans versus 4% of white mortgage applicants.

For many Black Americans, student loan debt creates a barrier to saving for a down payment. NAR found that 43% of Black households have student loan debt, compared to 21% of white households. Black households with student debt owe a median of $40,000, while white households have $30,000 in student debt. Approximately one-third of Black homebuyers and a quarter of Asian respondents said they experienced discrimination with the types of loans made available to them.

A large number – 41% – of Black respondents said they faced stricter requirements because of their race, compared to 27% of Asian Americans, 19% of Hispanic Americans and 16% of white Americans.

Fifteen percent of Black Americans tapped into their 401(k) and pension funds, while 10% of Hispanic Americans used their retirement funds, compared to 5% of white and Asian Americans. Only 17% of Black American homebuyers used the money from selling their primary residence as a down payment, compared to 18% of Asian American, 21% of Hispanic American and 37% of white American homebuyers.

“This data reinforces the need to implement key policy initiatives NAR developed in concert with the Urban Institute and the National Association of Real Estate Brokers to address the Black homeownership gap,” NAR President Charlie Oppler said in the press release.

NAR developed a five-point plan in 2019 to increase Black home ownership. The plan calls for; addressing housing supply constraints and affordability; promoting an equitable and accessible housing finance system; advancing policy solutions at the local level; providing additional counseling and outreach initiatives for renters and mortgage-ready millennials; and focusing on sustainable home ownership and preservation initiatives.

The Biden administration’s proposed first-time buyer tax credit of as much as $15,000 would address many of the disparities found in the report, according to NAR. Under the proposal, homebuyers would receive their tax credit at the time of purchase instead of having to wait until they file their income taxes the following year. NAR also believes the first-time buyer tax credit should come with incentives that would create more affordable housing units so that the credit would not contribute to the ongoing shortage.