Is there a Gender Property Gap when it comes to Mortgage Affordability?

We’ve all heard of a gender pay gap, but is there a gender property gap when it comes to mortgage affordability on the average home?

Online estate agent eMoov.co.uk has highlighted the gap in mortgage affordability between men and women, based on the gap in their average salaries.

The deficit between the average salary for men and women, plus the ever-increasing cost of homeownership are two widely debated topics. So what happens when you combine the two?

eMoov has analysed the latest Office for National Statistics (ONS) data for the average wage over a ten-year period (2006-16) for both men and women, and then looked at their mortgage affordability, at 4.5 times that wage. The agent then highlighted the gap in purchase power between the two, showing mortgage affordability as a percentage of the average house price at the time.

Is there a Gender Property Gap when it comes to Mortgage Affordability?

The last ten years

Over the past ten years, typical mortgage affordability of male homebuyers has been 72% of the average house price – 15% more than for female homebuyers (57%). This deficit remained around this level until 2013. It peaked at 17% in 2009, with the make salary allowing 79% mortgage affordability on the average house price, to just 62% for women, with the higher threshold of affordability largely due to the market crash.

Since, the gap has started to close and today sits at 12%. But, with house prices again finding their way back to pre-crash peaks, mortgage affordability for the average salary has dropped to 65% for men and 53% for women.

Despite this gap, the high cost of UK homeownership means that, since 2006, both average wages have lagged behind house prices where mortgage affordability is concerned.

By property type

The 2009 slump in house prices saw the highest mortgage affordability as a proportion of the average property value, with men tipping 52% for a detached property, 83% for a semi-detached home, 97% for a terraced house and 91% for a flat. In contrast, female mortgage affordability only hit 41% for a detached house, 65% for a semi, 76% for a terraced home and 71% for a flat.

Today, that has fallen again, with men sitting at 43% of the average value of a detached home, 69% of a semi, 80% of a terrace and 72% of a flat. For women, this drops to 35% of a detached house, 56% of a semi, 65% of a terrace and 58% of a flat.

The Founder and CEO of eMoov, Russell Quirk, comments on the findings: “It’s a welcome sight that the gap in salary between men and women, and in turn mortgage affordability, has started to close over the last few years, but a gap remains none the less. Homeownership provides enough hurdles for the current generation of first and second time buyers as it is, without gender having to play a role.

“The only saving grace is that many are in the position to buy with their partner and so the combined mortgage affordability of both is enough to see them onto that first rung of the ladder.”

He adds: “While the increasing growth in property values due to a severe lack of supply is an issue, the second side to it is the lack of growth in the average wage. If this was addressed, it would at least go some way in bridging the gap for those struggling to buy at present.”