What Is the Homeownership Gender Gap?

What is the homeownership gender gap?

The Balance / Julie Bang

DEFINITION

The homeownership gender gap refers to the fact that men are more likely to be homeowners than women. Men also see greater returns on their homes than women do, on average.

How the Homeownership Gender Gap Works

When you see the term “homeownership gender gap,” it refers to the gap in homeownership rates between men and women. This gap is a critical one because of homeownership’s role in building wealth.

Americans invest in real estate more than they do the stock market, making homeownership one of the key contributors to household wealth. It’s also a way that families build generational wealth, a wealth that hasn't always been easily accessible to women and people of color. And studies find that people who own affordable homes have more discretionary income for important goals such as paying off debt, saving for education, or starting a business.

Yet because women are less likely than men to own homes, women are at a disadvantage when it comes to building wealth. The homeownership rate among female-headed households is 61% compared to 67% among male-headed households as of 2019, resulting in a gap of six percentage points.

However, this can be seen as promising news, because in 1990, the gap was much larger—20 percentage points.

“As women made gains in higher education, access to full-time employment, higher pay, and higher income positions—as well as with more households now identifying as led by women—this homeownership gap has shrunk over the last few decades,” Eric Maribojoc, executive director of the Center for Real Estate Entrepreneurship at George Mason University, said in an email to The Balance.

Single female homebuyers now make up 20% of first-time homebuyers and 18% of repeat buyers compared to 11% and 8%, respectively, for single male homebuyers.

Although trends in recent data are encouraging, they don’t tell the whole story about the homeownership gender gap.

For example, women are paying approximately 2% more for homes, and selling them for about 2% less, said Holly Danko, chief people officer at home co-investing company Unison, in an email to The Balance. That data comes from a 2020 Yale study, which found that single women lose around $1,600 per year relative to single men on the same house.

Causes of the Homeownership Gender Gap

One major factor in the disparity in homeownership is the pay gap that also exists between men and women, according to Christian Mills, home equity conversion mortgage specialist at Reverse Mortgage Funding LLC. As of 2020, women typically earn 84 cents to every dollar a man earns in median hourly earnings in part- and full-time positions.

“This means women may have less income for homebuying than their male counterparts, and that when they do buy homes, they may be less expensive or in less affluent areas,” Mills said in an email to The Balance.

The wage gap is wider for women of color. Black women earned 64 cents for every dollar earned by a white, non-Hispanic man in 2020, despite having some of the highest labor-force participation rates. Hispanic women see the largest pay gap, earning 57 cents for every dollar earned by white, non-Hispanic men.

Additionally, out of the approximately 11 million single-parent families with children under the age of 18 in 2021, single mothers headed close to 80% of them. Single fathers, on the other hand, have higher incomes and are far less likely to be living at or below the poverty line, on average.

Similarly, women face disproportionate caregiving responsibilities for elderly parents and other adults, preventing them from investing time and financial resources into homeownership at the same rate as men.

Lower lifetime earnings among women not only results in less money to put toward a down payment on a home, but it also leads to higher debt-to-income ratios and worse credit scores, which can make women less likely to qualify for affordable home loans.

Women pay higher mortgage rates in every state but Alaska, even though women statistically are more reliable when making mortgage payments.

How the Homeownership Gender Gap Impacts Women

Mills said that owning a home not only is a cornerstone of the “American dream,” but also a basic building block of wealth building. However, another gap persists here as well: The median woman’s wealth is equal to 55 cents for each dollar of male wealth.

“Owning a home means not only providing a place for you and your family to sleep at night, but also owning an asset that has increased in value at a steady pace,” Mills said. “Plus, owning a safe and stable home greatly increases the chance of someone creating upward economic mobility for themselves and their family.”

That’s because the stability homeownership provides makes it easier to focus on things such as education, improving job prospects, and forming a network or community to support you.

Key Takeaways

  • The homeownership gender gap refers to the difference in homeownership rates between men and women.
  • As of 2019, the homeownership rate among female-headed households was 61% versus 67% for male-headed households.
  • Women pay more for their homes and sell them for less than men, on average.
  • Major contributing factors to the homeownership gender gap are that women earn less than men, on average, and have more caregiving responsibilities.

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Article Sources

  1. Paul Goldsmith-Pinkham and Kelly Shue. “The Gender Gap in Housing Returns,” Page 1.

  2. Urban Institute. “A Three-Decade Decline in the Homeownership Gender Gap: What Drove the Change, and Where Do We Go From Here?” Page 3.

  3. National Association of Realtors. “Women Home Buyers.”

  4. Yale Insights. “Single Women Get Lower Returns From Housing Investments.”

  5. Pew Research Center. “Gender Pay Gap in U.S. Held Steady in 2020.”

  6. Center for American Progress. “Women of Color and the Wage Gap.”

  7. Census Bureau. “America’s Families and Living Arrangements: 2021,” Click Table F6. See cells B9, D9, and N9.

  8. Pew Research Center. “The Rise of Single Fathers: A Ninefold Increase Since 1960.”

  9. Habitat for Humanity Chicago. “Women and Homeownership: The Hurdles and Why We Must Overcome Them.”

  10. OwnUp. “The Gender Gap: Women Pay More for Their Mortgage Than Men.”

  11. Federal Reserve Bank of St. Louis. “Gender Wealth Gap: Families Headed by Women Have Lower Wealth.”