The Gender Gap in Housing Returns

Abstract

Housing wealth represents the dominant form of savings for American households. Using detailed data on housing transactions across the United States since 1991, we find that single men earn one percentage point higher unlevered returns per year on housing investment relative to single women, with couples occupying the intermediate range. The gender gap grows significantly larger after adjusting for mortgage borrowing: men earn 6 percentage points higher levered returns per year relative to women. Data on repeat sales reveal that women buy the same property for approximately 2% more and sell for 2% less. The gender gap in housing returns varies by holding period, and arises because of gender differences in the location and timing of transactions, choice of initial listing price, and negotiated discount relative to the listing price. 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.