The New Feminism: A Home of One's Own

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Why you should care

Because they’re capable of putting a ring on that thing all by themselves.

She’s not buying it … and never will. Kara Perez, a 28-year-old personal finance blogger from Austin, Texas, says homeownership is “a dead part of the American Dream” that she simply can’t afford. To her mind, prices are outrageous and U.S. incomes are stagnant — so much so that “you won’t be able to pay off a mortgage without going to some extremes.”

This sentiment, shared by many millennials, is driving overall American homeownership down, but that doesn’t mean all of Perez’s female peers are following suit. In fact, figures from the new Millennial Tracker at Ellie Mae, a technology provider for banks and brokers, show that of the roughly one-third of 18- to 35-year-olds who are buying, there’s a surprising gender difference emerging. While men are still outbuying women — between May and July 2016, women were listed as the primary borrowers on just 32 percent of the closed millennial loans — women are taking the plunge more readily before getting married, while most men are waiting for the ring.

Of females listed as the primary borrowers, 61 percent were single.

That’s compared to male borrowers, 58 percent of whom were married and 42 percent of whom weren’t (and 39 percent of the women who were married). “Men are waiting for that family formation before they’re willing to settle down and buy a home,” says Joe Tyrrell, executive vice president of corporate strategy at Ellie Mae. Women, on the other hand, are “looking at an opportunity to get into homeownership now and start to build equity.”

Also, while young men lead the charge in hubs like New York, where 68 percent of closed millennial loans were secured by males, compared to just 30 percent by females, women are starting to reverse that trend in parts of the Midwest. In Midland, Michigan, for example, women represented 48 percent of mortgages in recent months among young adults, compared to 52 percent for men.

Still, homeownership is at its lowest level since 1965: 62.9 percent, according to the U.S. Census Bureau. Millennial hesitation certainly isn’t helping, but the majority of them — 79 percent, according to Apartment List — would like to purchase a home someday and say affordability is the biggest hurdle. Many 18- to 35-year-olds are simply waiting longer to buy — Bank of America’s Homebuyer Insights Report shows that 77 percent of first-time millennial buyers prefer to skip the starter home and save up for a place that meets their future needs — or choosing to rent, which has taken millennial ownership levels down to 34.1 percent.

Federal Housing Administration loans have long helped lower-income and first-time home buyers get on the market. Now major national lenders are starting to get in on the same game, says Tyrrell, wooing the millennial market by offering FHA-like loans with lower down-payment requirements. Conventional mortgages require upwards of 20 percent down, while FHA loans can be secured with as little as 3 percent of the purchase price down. Nearly 40 percent of FHA loans in recent months have gone to millennials, and banks are starting to see that in order to draw this millennial cohort — a group Tyrrell says will be “the key driving factor moving forward for the U.S. economy” — they have to have programs that compete with FHA loans.

This means more millennials will soon find it easier to take their first step onto the housing ladder, where they’ll join women like Bracey Bethea, a 25-year-old software company program manager who lives in Raleigh, North Carolina. Bethea decided to take the plunge into homeownership while still young and single. She didn’t want to bet her future on the idea of “finding someone, falling in love, getting married and then settling down, because that’s not a guaranteed path.” Besides, she says, “I’m capable of owning my own home by myself.”

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