Written by Robert H. Ruth
According to two recent studies, one published by the National Association of Realtors, the other by Harvard University’s Joint Center for Housing, single women represent 17% of homebuyers throughout the US. That is a very significant number… it shows that single women are the second biggest demographic segment of the purchase market after married couples. By comparison, single men only account for 7% of homebuyers.
Here are a few significant findings from the studies:
- More than one in five home buyers is a single woman
- There are twice as many unmarried women buying homes than single men
- Single women buyers equal more than 33% of the growth in home ownership since 1994
These statistics are even more impressive when you consider that before Fair Lending Laws were passed in the 1960’s, hardly any women bought homes by themselves. Clearly, times have changed. The question is why are single women buying so many more homes than single men? What is driving this trend? Is this just the beginning or will this number continue to grow? There are many reasons:
- Tired of current living situation
- Dissatisfied with increasing rent payments
- Desire to live closer to work or family
- Low Interest rates
- Women are great financial managers
- Women are earning higher incomes
Let’s look at these in a little more detail:
Current Living Situation
Women in both studies cited being unhappy with their current living situation as a primary reason for deciding to purchase a home. The NAR study stated that 30% of single women buyers just wanted a place they could call their own, while 10% said they wanted a bigger place than where they currently live. They also cited a strong desire to live in a neighborhood where they felt safe.
Dissatisfied with increasing rent payment
23% of single females cites increasing rent as a main driver for their desire to buy a home. Throughout the US rents are soaring, and single women realize that for the same amount of money each month, or possibly just a bit more, they can own their own house. As a renter, you’re paying the landlord’s mortgage.
Desire to live closer to work or family and friends
14% of the respondents stated this as a reason for a home purchase. This seems to be about quality of life more than anything else. Women want to be near the people who are important in their lives, and this desire for closeness is a big key for them.
Low Interest Rates
The historically low rates we have been enjoying have made owning a home more affordable than ever before. Since a single woman has to qualify just on her income, the lower rates have helped them qualify, in many cases, for more house than they could purchase previously.
Education and Income
Data shows that women earn bachelor’s degrees at greater rates than men, and women earn their degrees faster. Because women are highly educated, they feel more informed and empowered. This gives them greater confidence that they can make a large purchase. In addition, according to a study by Allianz Life Insurance, 57% of all women have more earning power than ever before, and the incomes they earn are sufficient to qualify for a mortgage on their own.
Financial Management Skills
Women are strong, capable financial managers. Anecdotally, based upon my 31 years’ experience writing mortgages, I have seen that women have better budget skills, higher credit scores, less overall debt, and a greater ability to successfully carry out long term investing objectives.
A recent Motley Fool article cited a Fidelity Investments study that found that women’s investment portfolios do better than men’s, women are better savers, women are stronger risk managers, and women have a more patient outlook with respect to investing. All of these attributes are important in saving for a down payment on a home and managing for the future. This long term, strategic approach to finances, I believe, is a key attribute women share.
So if you are a single woman who is reading this and thinking, “I can do this”, please call me to discuss your financing options. I love helping people understand the process of buying a home and making their dream of home ownership become true.