The real estate playing field isn’t level for women and men, a new study shows.
A recent report by Kelly Shue and Paul Goldsmith-Pinkham of the Yale School of Management, “The Gender Gap in Housing Return,” with data from CoreLogic, analyzed over 50 million home sales between 1991 and 2017. Results indicated there are significant disparities in buying power and trends between females and males.
According to the report, single women, on average, pay 2 percent more for the same house as a single man, and also sell their homes for 2 percent less. After looking at several factors, such as age, listing agent, income, type of home, ethnicity and education, the report found that women are losing, on average, $1,370 per year on their homes when compared to men.
Why such a loss? The report states the market environment plays a big role, as well as buying with risk. Single women may be tied down with children or may be making lifestyle-based decisions versus financial decisions, for example, and so the timing is different, showed the report. Men may be purchasing riskier properties with higher returns.
“Women earn lower returns on housing partly because they tend to buy when aggregate house prices are high and sell when they are low,” said the researchers.
In a tight housing market, however, the gap is nearly nonexistent, they found. It’s the areas with a higher average age, lower average education and a higher population of single females that are more associated with a bigger gender gap.
“Gender differences in upgrade rates, preferences for housing characteristics and listing agents appear to be less important factors. The gender gap varies with market tightness and demographic characteristics, but remains large in regions with high average education, income and house price levels,” the researchers stated.
The biggest problem? It doesn’t all revolve on how the market is faring. It’s also about how women (especially single women) are perceived in the market. The report found that women are being treated differently from the start—especially during the offer phase. During negotiations, men typically garner larger discounts.
“People are more offended by lowball offers from female buyers. It is an unfortunate consequence of perhaps our culture, and the fact that we may expect that women are more willing to share the pie and share the surplus from negotiation,” said Shue in an interview with NPR.
The largest discounts typically go to a male buyer (with a female seller).
So, where do women win out? When they transact together.
“Women, on average, do better when they are transacting with other women,” Shue said.
Liz Dominguez is RISMedia’s senior editor. RISMedia is the residential real estate industry’s definitive source for news and information.
