Why Home Buying Dreams Seem Less Affordable To Single Moms
Why Single Moms Feel Their Home Ownership Goals Aren't Attainable
Single moms have big aspirations, especially when it comes to providing the best possible lives for their kids, and for themselves. But in this market, a number of single moms are more scared than ever about providing a consistent home to raise their family in. Why? Let's get into it!
What We’ll Cover
The Housing Crisis
Albuquerque isn't the only city experiencing a housing shortage; with rising buyer demand, higher purchase prices for homes, and increasing interest rates on home loans fewer people are able to purchase a home of their own. Fewer still, single mothers, working to give their family a home to call their own.
According to Fortune.com - "over the past two years, U.S. home prices are 34.4%, including a 19.8% jump over the last 12 months."
Because inventory continues to be low for majority of the Nation, especially the larger/more popular cities, this means that the homes that ARE availabe, aren't in the budget most single mom's have to purchase a property.
These factors, and many others, are creating the appearance that home buying dreams aren't affordable to many single moms.
Rising cost of living
CNN Business tells us more about the rising cost of living in the United States, stating that "Daily life continues to get more expensive as American households battle the worst inflation in 40 years."
The article expands, showing evidence of cost spikes in every aspect of living: from groceries, to gas, to clothing, to housing, families are paying hundreds more per month than this time last year. "Food prices alone are up almost 9%, leaving many families to make difficult choices at the grocery store. Meanwhile, prices at the pump are up 43% from a year ago."
The article states - "This has forced many people -- especially those who are solely responsible for their family and finances -- to make sacrifices and cut back where there's often little wiggle room." Further showing that single moms left with the brunt of their family financial decisions are making more sacrifices and changes just to survive, let alone to save up to purchase a home!
Housing costs vs wages
The median sales price for homes sold in the U.S. in the first few months of 2022 is upwards of $420,000. While the average income for single mothers is around $51,000 - according to ZipRecruiter.com.
Based on the information shared on the PlutusFoundation website, the cost of raising 1 child in the US is nearly $13,000 per year! Let's assume the average number of children per family is 2 (just up from the 1.93 average shown here) that means roughly $26,000 a year, just towards the basic costs of raising 2 kids. Leaving mom with less than half of her income to pay for remaining expenses that may or may not affect her family.
The goal of saving money to put down on the purchase of a home is left on the back burner while many single moms are forced to work full time, multiple jobs, or even partaking in side hustles, just to make ends meet for their families.
Importance of homeownership for single mothers & children
"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." according to this article.
How does homeownership affect children? Harvard completed a study to better understand the benefits of homeownership on the children of homeowners. They found that children of homeowners showed higher cognitive test scores, suffered from fewer behavioral problems, and were provided better home environments than their counterparts; children of parents who do not own their home. "We find that these results hold even after controlling for a large number of economic, social, and demographic variables"
Homes are proven to be beneficial to children because they provide a sense of belonging in the child(ren), allowing them to create deeper bonds with their family. Sleep was also reportedly improved, in children with homes, based on this article. Homeownership is known to alleviate financial strain, create buildable wealth, and even model healthy decision making and patterns for children.
Resources to make homeownership goals more attainable for single moms
There are a few ways to help single mothers focus on the goal of homeownership, many of which involve financial decision making.
1. Invest in life insurance for yourself and your children.
2. Create a budget for your monthly and yearly expenses.
3. Open at least 1 bank account with checking and savings options.
4. Ask your Realtor if they have a credit repair resource that can guide you through improving your credit before applying for a loan.
5. Meet with a local lender to ask about programs and loan options available for you based on your credit score, income, and needs.
6. Consider childcare swaps, free or cheap(er) extracurricular activities, staycations and other ways to decrease costs while you save.
7. Monitor your credit score. Report any errors asap to keep your score on track for improvement.
8. Ask a Realtor to set you up with a home search in your area based on your needs and criteria.
I partner with numerous resources here in Albuquerque, NM to help my clients build their credit, find the best lender for their needs, and even discussing the option to sell and upgrade after living in their home for a certain period of time. My goal is to provide the knowledge, resources and value that my clients need in order to find and purchase a home that fits their criteria.
Many of my services are free, or very low cost. Especially for my buyer clients. I focus on helping millennial mamas decrease their stress by increasing their square footage, and that looks different for each client. Whether that means selling a current home to upgrade, or helping a first time buyer find a home, allowing them to move out of their rental or apartment, or even guiding multi-generational families find properties suited to their unique needs, I'm here to help & would love to help YOU!