WINDHOEK - Single men are now the fastest growing group of home owners, accounting for 42 percent of total home transaction volumes. At 30 percent, the proportion of transaction volumes by single women significantly lags behind that of single men, which is a clear indication of a gender gap in the housing market.
These striking figures are revealed in a just released FNB Namibia paper, focusing on the demographics of home ownership, something that, besides house prices and volumes, also has an influence on the housing market – in particular, consumer purchasing patterns.
Ruusa Nandago, Market Research Manager at FNB Namibia explains that gender gaps in economic opportunities and wage incomes, for example, mean that women account for a smaller share of household income and are, thus, less likely to accumulate savings for the purchase of property.
“Furthermore, there have been concerns that millennials and young working professionals have been excluded from the housing market and may never own homes of their own, owing to high levels of unemployment among this demographic.” Nandago elaborated: “Historically, transactions in the housing market have been dominated by couples. The data, however, reveals that there has been a sharp decline in the number of housing transactions by this cohort since 2017, with couples accounting for only 28 percent of all housing transactions in the first half of 2019. This decline can be attributed to changing marriage trends, characterised by an increasing number of individuals opting to marry later in life or opting not to marry at all. The FNB paper also indicates a declining trend in the number of couples choosing to marry in community of property; consequently, less couples are registering joint bonds. This is a strategy that provides some relief in terms of affordability, as it allows individuals to own two properties that can be registered as primary residences for which no deposit is required. Another interesting discovery from the report is that single women purchase lower priced homes than single men. “The gender gap in the housing market is further corroborated by gender differentials in the average house price of homes purchased. The data shows that single women have consistently purchased lower priced homes when compared to single men. On average, the price of a home purchased by a single woman is 11 percent lower than that purchased by a single man. In the first half of 2019, the average house price for single women was recorded at N$941 008, while that of single men was recorded at N$1 024 138.”
The bank’s report also showed that the average house size is the smallest for single women measured at 493 sqm in the first half of 2019, followed by single men’s houses measured at 607 sqm, and couples’ houses measured at 639 sqm. The average house size for single women being lower than that of men is, however, unsurprising, given that single women purchase lower priced houses than men.
The FNB report continues that the gender gap in the housing market mirror the
gender gap in the labour market and goes on to prove through the descriptive analyses that a clear gender gap exists in the overall housing market. This gap is consistent with gender gaps in the labour market pertaining to employment status and earnings.
According to the 2018 Labour Force Survey, women have higher rates of unemployment at 34.3 percent compared to men, whose unemployment rate is 32.5 percent, despite making up 51.4 percent of the population. Furthermore, women earn a lower monthly mean wage of N$7 789 compared to the mean wage of N$8 052 for men.
Nandago goes on to say that the average age of a home buyer in Namibia shows a declining trend and the average age has come down to 38 years old, which is the lowest it has been in 9 years. “When compared to other jurisdictions, Namibians buy their houses at a much later stage in life. The average age in the UK, for example, is much lower at 30 years, while the average age in the US is 32 years old. Interestingly, the average age for single women home buyers (35 years) is slightly lower than that of men (37 years).”
Not surprisingly, the report also revealed that the youth have low participation rates in the housing market, and the bulk of housing transactions are done by individuals in the 30-39 age group (49 percent), followed by individuals in the 40-49 age group (28 percent), individuals in the 20-29 age group (14 percent), individuals in the 50-59 age group (8 percent), and finally individuals over 60 years old (1 percent). The ultra-low housing market participation rate of individuals in the 20-29 age category is also unsurprising, given the high levels of youth unemployment across the country.
Finally, the report showed that individuals over 60 buy the biggest houses. “Individuals in the 20-29 age group have the smallest sized houses, which we attribute to the fact that these are first-time buyers who have not accumulated sufficient wealth to buy larger properties. The size of a house becomes increasingly larger as individuals move into higher age groups. Surprisingly, however, individuals in the over 60 age category buy the biggest houses in terms of size, although they make up the smallest proportion of home buyers. Typically, it would be expected that individuals in this category downsize their houses as they prepare for retirement. Nandago concluded that the Namibian labour market is characterised by gender inequality and age gaps. “Data from the FNB House Price Index also shows that disparities in employment and income according to gender and age are realised in the housing market. These are observed when looking at the number of transactions, the price of houses and the size of the house stand purchased.
Owning a home fulfils the basic human need for shelter, and a house is likely to be the largest asset owned by a household for wealth accumulation. It is of utmost importance that individuals of different groups have equal access to housing, as this improves their quality of life. It is, therefore, necessary to address issues of gender discrimination in the labour market and the high youth unemployment rate in order to close these gaps in the housing market.”