Women Home Buyers: Challenging The Homeownership Gender Gap

Gone are the days of almost always needing a partner to buy a home. Single women now increasingly have the ability and the desire to buy homes on their own. These changes have largely been driven by an increase of women in the workforce along with new career opportunities and financial independence for women.

Single women are buying up more property than single men but tend to get the shorter end of the stick with the return on their investment. So, what gives? Let’s explore the various facets of the homeownership gender gap, why it may be occurring and the steps we can take to close it.

Single Women Own More Homes Than Single Men But Get Lower Returns

The 2023 Home Buyers and Sellers Generational Trends Report from the National Association of REALTORS^® says that single women make up 17% of home buyers, with single men accounting for only 9% of buyers. However, a Yale study released in 2020 found that single women paid around 2% more for homes and sold for 2% less.

While 2% may not seem like that much, it’s significant when you consider the cost of a mortgage. Single women were losing $1,600 per year on average compared to a single man in a comparable house. The researchers noted that the gap size depended on how long they lived in the home, with the gap decreasing the longer they stayed.

A caveat to the 2% trend was that the discrepancy shrank when single women bought from and sold to other women.

The Intersectionality Of Housing Discrimination

Although this article focuses primarily on women’s experiences in homeownership, it would be neglectful to ignore the intersectionality of housing discrimination throughout U.S. history. A variety of laws and practices have made it more difficult for people of color, people with disabilities, and the LGBTQ+ community to enter and profit from homeownership.

The history is deep and complex, and we’ll just barely scratch the surface, but we encourage you to learn more.

Female Homeownership Trends Throughout History

A study from the Journal of Economic Perspectives showed that single women have exceeded single men in homeownership since at least as far back as 1985. Let’s take a closer look at how different factors affect the data around homeownership for both men and women.

Single Homeowners With No Children

In the mid-1980s, about 42% of single men with no children were homeowners, compared to 53.6% of women with no children. In 2015, approximately 52.6% of single women with no children owned a home, compared to 46.2% of comparable men. When adding children to the mix, these numbers start to shift in favor of single men.

Homeowners With Children

The 2015 data shows that married couples garner higher rates of homeownership, with or without kids. Couples with kids came in at 70.8%, and those without children were at 82.5%. For single women with children, homeownership in 2015 hovered near 32.8% versus 45.6% among single men with children. These numbers may show that single parents need more support to achieve their financial goals.

Families And Unmarried Couples

Looking at the numbers for families and unmarried couples, little has changed over the past several years. The previous trends report from the National Association of REALTORS^® noted that 8% of home buyers in 2015 were unmarried couples, compared to 10% of buyers in 2023.

In 2015, 36% of all buyers had children under the age of 18 residing at home, while approximately 31% of all buyers in 2023 have children of the same age.

More open-minded views are leaving room for new types of family structures and partnerships that shift away from a traditional patriarchal family model. In many cases today, women are surpassing their male partner as the family’s primary breadwinner. But while there’s been a lot of progress overall, there’s still more to be made.

Why Single Female Home Buyers Pay More And Sell For Less

Multiple reasons may explain why a price gap exists between male and female homeowners. Standout factors include the negotiation process, market timing and potential attachments to a particular property.

Gap In Negotiation

A study by the National Bureau of Economic Research has shown that women are less likely to negotiate the price of a home sale. However, a more recent study in the Journal of Economy and Society examining salary negotiations found that women “ask” as often as their male counterparts but don’t “receive” at the same rate. Some social perceptions and biases against women may factor into bargaining situations.

For women of color, these issues may play an even more significant role. Therefore, women may need to come equipped with additional information and negotiate better than men to achieve their desired outcome.

While biases have cost many women extra dollars when buying a house, single female buyers can take steps to overcome this form of prejudice in bargaining outcomes. Later on, we’ll explore some tips designed to help women do the right research and show up better prepared for negotiations.

For now, just remember you can take steps to prepare to buy a home and show the seller you’re serious about moving forward. It all starts with filling out a mortgage application as soon as you begin house hunting.

Market Timing

The previously referenced Yale study showed that, on average, single men timed the housing market better than single women, which played a large role in the return on investment (ROI). When looking at this factor, it’s important to consider that in 2022 there were nearly 8 million single-mother households, compared to only around 2.6 million single-father households, according to U.S. census data.

When adding children to the market timing mix, buyers may not have the same flexibility and bargaining power to hold out for a better deal.

Not Seeing True Value

The idea that women may be too particular about their potential home was mentioned in the study but not listed as a data-backed reason. The argument is that perhaps women are pickier about a property’s features or fall in love with the house they see as “the one.”

The exact reason women’s homes sell for less than men’s is a bit unclear. Perhaps women need to push harder than men to get the same results or do more research to appear just as informed – but it’s hard to say. Of course, situations change on a case-by-case basis, but if you show up armed with knowledge and greater confidence, you’ll likely see better results.

10 Tips For Single Female First-Time Home Buyers (And Repeat Buyers)

Closing any gap built on inequality and prejudice requires everyone to be aware and actively fight against it. We can’t control others’ thoughts or actions, but women can take certain steps to improve their bargaining outcomes and have a more positive home buying experience.

Below are 10 tips aimed at helping repeat and first-time home buyers close the women’s housing gap and become savvier homeowners.

1. Know Your Rights

By researching your rights as a home buyer or owner, you can better recognize shady or discriminatory practices. The U.S. Department of Housing and Urban Development (HUD) has a wide network of housing help and information about your rights.

2. Improve Your Credit Score

Landing a great mortgage is a crucial part of getting the best return on your investment. To secure the best mortgage rates, you need at least a good credit score. That means you’ll want a score of 670 or higher to land the best rate. 

3. Seek Advice From Mortgage Pros

Even with research, you probably will still have questions about the home buying process. That’s why you should talk with a mortgage specialist. Even experienced home buyers can benefit from the insider tips and info on current trends that experts can provide.

4. Evaluate Comparable Sales And Statistics

It’s possible to assess the value of a property in numerous ways. One method is to look at the sales price of similar homes in the neighborhood. You can also check out other indicators of a home’s value, such as unemployment rates and job growth in the area. These numbers can showcase the investment potential of your prospective home.

5. Look Into Special Loans And Low Interest Rates

To get the best deal on your mortgage, you should take advantage of any resources and programs available to you. A wide variety of down payment assistance options are available in the form of no/low-interest loans, grants and more – especially if you’re a first-time home buyer.

Additionally, you’ll want to get initial mortgage approval (also called mortgage preapproval) early on in the home buying process. This will give you the opportunity to lock in the lowest interest rate as soon as you’re ready to make an offer on a house.

6. Learn About The Seller’s Motivation

Understanding the seller’s motivation not only helps you find a more effective negotiating tactic, but it can also help you make a personal connection with them. Take time to see if the current owner has a mortgage or conduct a public record search.

7. Pay For A Professional Home Inspection

A home’s value is only as accurate as its inspection. You should always get a potential purchase inspected. Without a quality home inspection, it’s too easy to get burned and lose big time on your investment. You can also use the home inspection report as a bargaining chip.

8. Show You’re A Serious Buyer

By showing you’re serious about purchasing a house, you can potentially speed along the buying process and convince the sellers you’re a legitimate option. You can do this by offering a large earnest money deposit or attaching a Verified Approval Letter to your bid.

Having an initial mortgage approval in hand is one the best ways to show a seller you’re serious about buying their house. Not only does it indicate you’ve taken steps to prepare for the home buying process, but your letter will let the seller know you’ll be able to get approved for a mortgage.

9. Experiment With Negotiation Tactics

You can use various negotiation strategies to get the best price. The tactic you go with should be tailored to your specific market, property, seller and the overall nature of the situation. Talk with your real estate agent or REALTOR^® about time-tested negotiation tactics and see if they have any recommendations.

10. Be Patient And Know When To Walk Away

Searching for a home and losing out on a promising property can be draining. It’s important to stay positive and not get deterred when all the stars don’t align. To avoid becoming discouraged, manage your expectations, understand your reaction tendencies and handle disappointments in a healthy way.

The Bottom Line: Know Your Worth Throughout The Home Buying Process

Before you can take the next step in your home buying journey, it’s important to ensure your finances are in order. Rocket Money℠ offers a library of resources to help you feel more prepared to buy a house, whether you’re a first-time or repeat home buyer. The mobile app can help you monitor your credit score and stay on top of bill payments so you can achieve your homeownership goals as soon as possible.

To learn more, download the Rocket Money app today.