Some fantastic news!
Women are doing well in the property market. That’s because women do have a slightly higher rate of property ownership than men.
But unfortunately, that is where the good news ends.
And that’s because when the fuzzy-haired people in white lab coats took a closer look, they found something interesting.
Among young Australians under 30, there is a staggering 24% property ownership gap between men and women. This means that significantly more young men own homes than women.
There’s more.
Men are more likely to own investment properties, and this means in the longer term, men will generate significantly more wealth than women. I don’t like that.
It gets worse.
That’s because on average, women tend to own properties and carry slightly higher debt levels relative to their wealth. And over time, due to compounding, that can prove to be a significant disadvantage.
The logical question, then, is why?
Well, we think there are a few reasons:
1. Pay!
I probably do not need to tell you that women get paid less than men. About 15% less pay, in fact.
Is this sexism at play? Maybe. But we have rules and regulations in this country that say you can’t do that, so I do not think that is the full explanation.
It is a mixture of types of jobs (most men-oriented jobs eg tradies) that pay more than women-oriented work such as admin, and you need to remember God gave women a significant disadvantage when it comes to giving birth and raising children, robbing women of employment time and income.
This lower income provides challenges when it comes to saving for a deposit, getting a mortgage and paying for day-to-day bills.
2. Men take more risks
Not sure if this a mothering thing but women are more less likely to take risks when it comes to money especially large investments. Men on the other hand are less cautious and prepared to lose it all. Men are likely to over stretch which can lead to larger long-term gains.
So, what started out as fantastic news isn’t. And it sounds like women are doomed at creating wealth through property. I hope not and I do not think that the above is all doom and gloom. I have seen many clients, men and female get on the property ladder and do well. Yes, poor income generating ability significantly reduces your ability to buy property but that is not the only measure.
So, if you happen to be female and want to smash your male counterpart’s butt to the moon, what should you do?
1. I love it when a plan comes together!
I often tell clients that building wealth is not all about the income you generate.
All you really need is a good plan, research, and some fantastic advice. And the plan starts with a savings, goals and timelines.
So, work out when you will buy, how you will buy, and even where you will buy. Then, get someone to make sure you meet those goals.
Because it is the accountability and the goals that get you there, not the income you generate.
2. Is property the only way?
The chances are you may not be able to buy a portfolio of property. You may just want to get on the ladder.
Speak to professionals. Sometimes, they make you see things differently. There have been times when I have seen clients, and it becomes obvious that they simply do not have enough savings to buy a house.
Remember, property is not the only way to build wealth.
If there is no chance of getting a deposit, maybe your small savings can be put to better use elsewhere rather than chasing a dream that is just that—a dream.
You are betting off investing in other things rather than putting your money in a bank account to eventually find you cannot get on the property ladder.
3. Back to School
Not literally. Besides school is a terrible place to learn about money because they simply do not teach it there.
But very few people become rich or wealthy by accident. They have some knowledge. Not necessarily an awful lot, but they have some.
So, become knowledgeable.
Building wealth and investing is step 7 of our 9 steps to work less, earn more and create wealth. If you would like more information on this, email Hitesh at hitesh@medisuccess.com.au or call 07 3161 9548.
