Higher Interest Rates and Affordability Concerns Keeping Majority of Latino Homebuyers on the Sideline

CHICAGO, May 29, 2025 – Higher interest rates and home affordability challenges are causing 70% of Latino homebuyers in the U.S. to delay purchasing a home, while 68% of Latinos overall say owning a home remains one of their top financial goals according to new data from the BMO Real Financial Progress Index.

“For Latino families across the U.S., the majority are still waiting out the current rate environment before making their first home purchase or refinancing, but many report feeling like they are on more sound financial footing than a year ago, and home ownership is still viewed an important milestone of financial progress, stability, and generational success,” said Lizzy Diaz-Ortiz, Senior Manager of the Latino Banking Segment at BMO. “BMO supports customers throughout the home buying journey, offering actionable guidance to help turn financial aspirations into progress.”

Launched in February 2021, the BMO Real Financial Progress Index is a national study that explores how consumers feel about their finances and whether they’re making progress.

Key findings include:

• 75% of Latinos in California say they are waiting until rates drop before purchasing a home, along with 67% of Latinos in Arizona, 60% of Latinos in the Chicago area, and 80% of Latino respondents in Colorado.
• 68% say owning a home is one of their main aspirations in life, while 52% say it seems unattainable.
• 63% say they would be willing to buy a fixer-upper, slightly higher than the national average of 60%.
• 61% feel envious of others who have already purchased vs. 55% nationally.

Many Latinos are entering the housing market earlier with family support

Certain Latino households are entering the housing market at a younger age than the national average, using multigenerational financial strategies to overcome financial obstacles.

• The average age for Latino first-time homebuyers is 28 (median), younger than the national average of 30.
• 48% of Latinos say they would not have been able to buy a home without financial help from their families—rising to 60% among Gen Z Latinos.
• 41% of Latinos plan to use their 401(k) to fund a first home purchase (versus 34% nationally). 54% of Latino men respondents say they plan to tap into their retirement funds, while 32% of Latino women say they plan to do the same.
Facing challenges, but still confident
Latino consumers continue to report growing confidence in their financial standing even as they hold off on purchasing a home.
• 59% say they feel more financially secure today than a year ago. Customers can visit BMO SmartProgress — an easy-to-use, bilingual resource focused on everyday financial planning – to help build confidence in their financial decisions. In certain markets, homebuyers might be eligible for programs that provide downpayment or closing cost assistance like the BMO Welcome Home Grant Program.

About the BMO Real Financial Progress Index

Launched in February 2021, the BMO Real Financial Progress Index is an indicator of how consumers feel about their personal finances and whether they are making financial progress. The index aims to spark dialogue that will help consumers reach their financial goals and to humanize a topic that causes anxiety for many – money.

The research detailed in this document was conducted by Ipsos in the U.S. from March 3 to March 26, 2025. A sample of n=2,500 adults ages 18+ including n=277 Latino respondents were collected in the U.S. via the Ipsos panel. Quotas and weighting were used to ensure the sample’s composition reflects that of the American population according to census parameters.

For all U.S. adults, this survey has a credibility interval of +/- 2 per cent 19 times out of 20, of what the results would have been had all American adults 18+ been surveyed. For the Latino adults, the survey has a credibility interval of +/- 7 per cent 19 times out of 20, of what the results would have been had all Latino adults 18+ in the U.S. been surveyed.

About BMO Financial Group

BMO Financial Group is the eighth largest bank in North America by assets, with total assets of $1.5 trillion as of January 31, 2025. Serving customers for 200 years and counting, BMO is a diverse team of highly engaged employees providing a broad range of personal and commercial banking, wealth management, global markets and investment banking products and services to 13 million customers across Canada, the United States, and in select markets globally.

Driven by a single purpose, to Boldly Grow the Good in business and life, BMO is committed to driving positive change in the world, and making progress for a thriving economy, sustainable future, and inclusive society.