Maryland Governor Wes Moore shared a poignant personal story at a recent BlackRock conference in Washington, D.C., reflecting on the transformative impact of education and opportunity in his life. At the age of 8, Moore faced the prospect of military school as a corrective measure for his behavior, a journey that eventually took shape when he was 13. Despite trying to escape multiple times within just days, Moore credits his experience at military school with significantly altering his life trajectory.

Citing financial barriers, Moore revealed that his mother struggled to enroll him early due to the steep tuition costs. The pivotal moment came when his grandparents, who had immigrated to the U.S., borrowed against their home to fund Moore’s education, emphasizing the importance of housing as a vehicle for opportunity.

Moore articulated the multi-faceted role housing plays in individuals’ lives, stating, “It’s not just shelter. It’s security; it’s an investment.” He underlined how homeownership provides a safety net during emergencies and serves as a passing asset for future generations. He noted that, after retirement accounts, housing typically stands as the second most substantial asset in a person’s financial portfolio.

However, achieving homeownership in today’s economy is increasingly challenging, with many young Maryland residents contemplating leaving the state due to soaring property prices.

A recent report from the Joint Center for Housing Studies at Harvard University highlighted a troubling trend: approximately 30% of young adults in Maryland are considering relocation largely due to exorbitant housing costs. The report cites an overwhelming rise in cost-burdened renters—individuals who allocate over 30% of their income on housing expenses—reaching unprecedented levels in 2022.

The analysis suggests a generational disparity regarding homeownership, indicating that individuals aged 35 to 44 today are less likely to own homes compared to their counterparts 45 years ago. The Urban Institute revealed that homeownership rates in this demographic have declined by over 10% since 1980, a trend exacerbated by decreasing household formation rates among younger individuals.

As noted by Jun Zhu of the Urban Institute, lower homeownership rates carry broader economic implications. “When you have a house, when the house appreciates, you’re going to earn home equity,” Zhu explained, underlining the importance of home equity as a key mechanism for wealth accumulation.

The steepest declines in homeownership have notably impacted those in lower income brackets. Additionally, social factors such as marriage rates play a critical role, with married individuals demonstrating higher homeownership levels compared to their unmarried counterparts.

Educational attainment also influences homeownership opportunities, with a smaller proportion of lower-income households achieving college degrees, further widening the homeownership gap.

The National Association of Realtors has reported disheartening disparities in homeownership rates across racial lines. In 2023, the Black homeownership rate reached 44.7%, marking significant growth yet still lagging behind the white homeownership rate of 72.4%. Meanwhile, Asian and Hispanic homeownership rates stood at 63.4% and 51%, respectively. Despite progress, the consistent sub-50% Black homeownership rate over the past decade continues to limit wealth-building potential within the community.

Experts like Nadia Evangelou have pointed to improving wage growth and the entry of younger generations into the housing market as critical factors contributing to the increase in Black homeownership. However, substantial barriers remain, necessitating targeted policy interventions to facilitate access to homeownership models.

Proposed strategies for bridging the gap include enhancing educational access for low-income families, establishing down payment assistance programs, and reducing zoning and regulatory restrictions to encourage housing development, as suggested by the Urban Institute.