The latest homebuyer survey by the National Association of Realtors released in the last quarter of 2021 shows that single women are outperforming their male counterparts in home buying. The homebuyers survey conducted for over 40 years reveal that women have been consistently making up the second largest demographic among the U.S. homebuyers for the last 40 years steadily overpowering the single men in the housing market.
The survey shows that in the year ending in June divorced, widowed and never-married women accounted for 19% of all U.S. home sales while unmarried men accounted for 9%.
According to Jessica Lautz- NAR’s vice president of demographic and behavioral research, single women are an absolute force in the industry which means their presence and influence cannot be ignored or taken lightly.
“Women have been second only to married couples as far back as we have tracked it, which is impressive considering until the 1970s women needed a co-signer for a credit card,” Lautz said.
While traditionally women have been denied opportunities that would make them earn more, hence lower incomes than men, NAR’s survey has shown that to compensate for that, single women are more willing to cut off their personal expenses in order to save for a home.
“Women are historically more likely to believe their home is a better financial investment than stocks compared to men,” Lautz said. “They’ll know what their (house) payment is going to be for the next 30 years. That’s incredibly important to women.”
Are women delaying marriages to buy homes?
Many women are refusing to get married or get in any relationship to give themselves enough space to invest in homeownership. This is happening for the first time in history where young women are independently pursuing the homeownership dream faster than young men.
Typically, married couples have accounted for the largest share of homebuyers in al 40 years since this survey began, but the share has been constantly declining from 81% in 1985 to just 60% this year. For the single men home buyers, their share has changes just a little, but the highlight is, it has never got over 12%.
This is a trend that is expected to continue into the future because the modern woman is more career focused now more than ever. As such she wants to be smart with her money and make an investment that sets her apart for the future rather than relying on marriage or waiting for a man to provide her with the life that she wants.
Additional, a trend that has been consistent with NAR’s findings is that women are excelling in their careers, getting married and having children later and are more determined and extremely driven to reach their goals a cocktail of qualities that breeds success when it comes to homeownership.
To support findings from National Association of Realtors homebuyer’s survey, LendingTree’s analysis found that single women own more than 1.5 million homes than men in America’s 50 largest metro areas. It highlight that cities with high ratios of single women homeowners are; Tampa, Florida (where single women own 16.4 percent of households and single men own 11.5 percent), New Orleans (16.1 percent versus 10.9 percent) and Buffalo, New York (16.1 to 10.2 percent).
This goes to show that while women have successfully closed one gender gap, they have opened another one that might take time before being effectively closed.
While Women May have come out on top, they are still low the financial chain…
Financially, women still make less compared to their male counterparts which raises a lot of questions. Another study from Yale found that single women are buying homes for an average of 2% more than their single men counterparts. In addition, the study found that women sell their home for 2% less which means, for a $200,000 house, that would amount to $4,000 less either way.
One other area single women are bleeding financially is in mortgages where single men will earn 6 percentage points more in annual returns from their home purchases compared to single women. Interestingly, the study also found that the gap grows wider in areas of high levels of education, high incomes and high home prices. There are so many reasons behind this but the most obvious ones according to the study are location, timing, choice of initial listing price and negotiation skills.
“We find that women purchase properties when they are listed at higher relative prices and also choose to list for lower relative prices,” the study explains. “In addition, women negotiate worse discounts relative to the listing price.”
Perhaps to support the claim that women receive less for their properties when they sell is the fact that the study also found that men preferred properties with “characteristics naturally associated with higher returns” which means they are more exposed to risk which often yields more returns. Furthermore, men invest more in upgrades and maintenances.
Owing to the fact that single women bought homes more (accounting to almost 20% of all homebuyers), this means that the gap in homeownership between these two cohorts could widen the wealth gap as the study suggests; “This gender gap is likely to be an important contributor to gender differences in wealth accumulation and welfare, given that housing wealth represents the dominant form of savings for most U.S. households.”
Women Rising In Labor force
Earlier I asked a question how women are rising to overpower the man when it comes to homeownership and in my finding, one fairly unexciting reason is that divorce rate is on the rise in America and when it happens, the woman is more likely to get the family home over the ex. Historically, whenever there is a divorce, women are the ones to take the house. Men are the ones to move out and thus, this affects these statistics.
While divorce plays a role in part, it is not the only reason. Over the years, women have been slowly but surely claiming her role in society to become a force to be reckoned with. Her steady rise in the labor force is everything remarkable and with such power, homeownership is almost automatic. According to Tendayi Kapfidze, chief economist at LendingTree, “Right now, the labor force participation rate for women is around 58 percent,” says Kapfidze. “It’s generally been on an upward trend, though there was some dip after the Great Recession.”
The latest job report from the Bureau of Labor Statistics show that women outnumber men in the workforce holding 50.04 percent of jobs as of December. “Women are staying single longer and are more and more career-focused,” says Nicole Middendorf, a financial adviser and certified divorce financial analyst. “The pay inequality piece is definitely there, but women start businesses at two times the rate as men, and that helps take away that pay gap piece.”
Moreover, according toi the State of Women-owned Business Report, commissioned by American Express found that the women owned businesses increased 21 percent between years 2014 to 2019. And if you look more closely into the data, you will see that the number of businesses owned by women of color actually doubled within the same period, growing to 43 percent in total.
Women Tend to be more Risk Averse
This can be a good and a bad thing at the same time. Research support that women are generally considered to be more risk-averse than men which is a fact that can be traced back to the way they were raised and also they way they socialize. This risk-averse nature also plays a pivotal role to explain why there are more single women homeowners than there are men.
“Women tend to be more conservative, which is good when buying a house,” says Middendorf. “Men often try to stretch it, but women, being more risk-averse, don’t stretch themselves to buy a home they can’t afford.”
Additionally, the fear of the unknown and getting prepared for future also has driven more women into homebuying, often considering homeownership as a safer investment.
Sources;
https://www.ocregister.com/2021/11/29/single-women-outpace-male-counterparts-in-home-buying/
https://www.forbes.com/sites/alyyale/2020/01/22/single-women-own-more-homes-than-single-men–but-they-pay-more-too/?sh=5715bcc028ca
https://www.hometrek.org/single-women-homebuyers-what-you-need-to-know/#:~:text=Single%20Women%20Home%20Buying%20Trends,workforce%20after%20World%20War%20II.
