July 22, 2024

Dream of Buying a Home Gets Harder for Single Mothers

“Covid was definitely harder on some households, especially single women with children,” said Jun Zhu, a co-author of the Urban Institute report and a clinical assistant professor with the finance department at Indiana University. “It is possible the pandemic can undo that progress.”

Homeownership is often viewed as a sign of financial stability, with good reason: It ensures that housing costs remain predictable even as rents and inflation rise. And though homeownership is not risk-free, it generally provides a growing store of wealth that can be tapped later or passed on to the next generation.

“Homeownership is an extremely important part of people’s savings and wealth accumulation, especially for middle-income or median households,” said Kelly Shue, a professor of finance at the Yale School of Management.

Ms. Shue analyzed government survey data from 1989 through 2016 and found that, among households with median savings, homes accounted for 70 percent of single women’s wealth near retirement, compared with 50 percent for single men and roughly 60 percent for married couples.

“It’s important for all groups, but especially for single women,” she said.

The pandemic, combined with the challenging market landscape, has eroded women’s confidence about their likelihood of becoming homeowners: Nearly 60 percent of single female heads of households who rent — those who never married, those who are separated or divorced, and widows — said they could not afford to buy and didn’t know if they ever would, according to a September study by Freddie Mac, the government-backed mortgage giant.

Article source: https://www.nytimes.com/2021/11/11/your-money/single-mothers-home-buyer-pandemic.html

Speak Your Mind