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Lenders see little profit in making loans below $100K, so many entry level homes go to investors paying cash rather than renters hoping to become homeowners.<\/span><\/span><\/p>\n<\/div>\n CHICAGO \u2013 Home prices nationwide reached record-breaking levels during the pandemic, but potential buyers for homes costing under $100,000 are struggling.<\/span><\/span><\/p>\n The problem isn\u2019t the buyers or homes so much as the lenders. Even when buyers qualify for so-called small-dollar mortgages, or those below $100,000, the lenders see the mortgages as unprofitable.<\/span><\/span><\/p>\n At the same time, investors who often don\u2019t reside in these communities buy up properties in all-cash deals and turn them into rentals, often compelling low-income Black and Hispanic tenants to pay hundreds of dollars more each month than they would on a mortgage.<\/span><\/span><\/p>\n \u201cIt\u2019s important [to offer more small-dollar mortgages] in this era where we\u2019re recognizing the severity of the racial wealth gap and finally trying to do something about it,\u201d says Sheryl Pardo, a spokeswoman for the Urban Institute.<\/span><\/span><\/p>\n In November, realtor.com had 50,100 listings nationwide for single-family homes priced at $100,000 or less, and not all were foreclosures or teardowns. The listings tend to be in smaller or mid-size cities but are also available in suburbs and rural areas.<\/span><\/span><\/p>\n Federal data gathered through the Home Mortgage Disclosure Act found that just 8.9% of all mortgages for owner-occupied homes were less than $100,000 in 2019. U.S. Census Bureau data indicates that in 2019 nearly 475,000 homes priced below $80,000 were sold. Of those sales, about 43%, or roughly 200,000, were financed with a mortgage.<\/span><\/span><\/p>\n\n