Why do women need 12 times their salary to buy a home, when men need only eight?

Home ownership has become much more challenging globally in the last few years. Rising interest rates, persistent inflation and the ongoing cost of living crisis seen in many parts of Europe have made this dream considerably harder to attain for several young people.

Soaring property prices and stagnant living wages have added another layer of complexity to this problem too.

According to the European Youth Portal, more than 10% of young Europeans aged 20 to 29 spend more than 40% of their disposable income only on housing costs. This is far above the standard 30% affordability benchmark.

However, women, especially younger, single women, could be at an even greater disadvantage when contemplating buying a home in Europe and the UK, leading to the rise of the gender housing gap.

Why is it more difficult for women to become homeowners than men?

One of the biggest reasons women, especially single women, are more likely to struggle to buy homes than men is due to the persistent gender pay gap still being seen in the UK and several European countries.

In 2024, the gender pay gap in the EU stood at 11.1%, while a Trades Union Congress report released in February this year estimated the UK’s gender pay gap to be 12.8% currently.

Women are also likely to face lower lifetime earnings and higher rates of part-time work, mainly due to more child-rearing, household and caregiving responsibilities, which can severely impact their career progression.

Combine that with the fact that women are less likely to ask for a pay rise according to the European Central Bank, and this creates a vicious cycle that can be very hard to break out of.

As such, they are likely to find it more difficult to save for a house deposit, stamp duty and other repair, renovation and maintenance costs, apart from a mortgage, that usually come with home ownership.

More women are also likely to reduce deposit savings due to financial pressures, while also delaying life milestones such as weddings and starting a family to prioritise saving for a house than men.

The Women’s Budget Group has found that women need over 12 times their annual salaries to be able to buy a house in England, while men need just over eight times. This gap can increase even more when it comes to house prices in key hubs like London.

According to a recent survey by specialist bank Aldermore, 33% of women consider saving for a deposit the biggest obstacle to home ownership, compared to 20% of men.

Similarly, rental costs are likely to hit women harder than men, the survey found, with 76% of women sharing that these costs are a struggle, compared to 67% of men.

As older and middle-aged women are significantly more likely to live alone than men, they also lose dual-income household benefits, making any significant savings and mortgage approvals even more challenging.

This is especially as European women are more likely to experience steeper drops in household incomes after divorces, compared to men.

Splitting a joint marital home can also leave the woman with insufficient capital to re-enter the property market as a sole buyer, redirecting her instead to an ever more competitive rental market.

One of the biggest economic barriers to female home ownership is also that women are likely to get lower maximum loan amounts from mortgage lenders, compared to men, due to these lower per hour and annual salaries.

In many cases, despite having a stable or relatively high income, mortgage holders may view women with part-time or freelance jobs as higher credit risks, which further decreases the chances of loan approval.

Several times, women also face a confidence and knowledge gap in the property market, due to lower financial literacy levels. According to the European Central Bank, only 15% have high financial literacy, compared to 27% of men.

They can also be much more dismissed by brokers, mortgage approvers and estate agents during the buying process, which can make the whole process feel much higher-friction.

Another less considered issue is that several new properties also frequently lack affordable, secure, multi-room housing for single-parent family units, which are overwhelmingly headed by women. This can often lead to them putting off a home purchase for longer, while sticking with renting.