Higher education and salary levels are among several factors that are giving single women the power to purchase a home on their own.

There’s a powerful new force that’s changing the face of the home buying process and is reshaping the landscape of the housing industry. Curious?

Well, take our quick two-question quiz to discover the identity and some important insights into this savvy and skilled homebuyer.

1.) Read the homebuyer trends below. Then decide: What category of buyer best fits the profile? a.) Traditional Families   b.) Single Men   c.) Single Women   d.) Active Adults

Generally speaking, this buyer group typically:

…Buys in city over suburban areas.
…Is interested in amenities and features.
…Will not compromise on location or quality of neighborhood.
…Prefers condominiums with homeowner associations over single family homes.
…Prefers 2 or more bedrooms
…Smaller spaces are acceptable.
…Desires security and / or gated access.
…Likes to engage in social interaction with neighbors.
…Wants close proximity to stores, shopping and fitness centers.

If you guessed, c.) Single Women, you’re absolutely correct. Single women represent the fastest growing component of home buyers in the United States at almost 20%. According to the National Association of Realtors, single women were responsible for buying approximately one out of five homes purchased in the country – a total of 1.7 million homes. (By the way, these same ladies outnumbered the single guys who represented only 15% of the buying population.)

2.) What’s attracting women to home ownership these days? a.) New Financing Opportunities  b.) New Motivations  c.) New Support  d.) All of the Above

You’re right again! It’s d.) All of the Above. According to a July 11, 2008 article in The Washington Times titled, “Single Women Skilled in Home Buying,” there are a lot of factors that have contributed to this growth in women buying and owning homes. First of all, increased wages and higher education levels for women have narrowed the gender gap in pay.

• New Financing Opportunities

Another major factor is the increased availability of financing through Fannie Mae and Freddie for women especially over the last decade with their outreach programs intended for first time homebuyers and minorities.

For example, divorced women are frequently given first time buyer status even if they owned a home in the marriage, making many low down payment or subsidized loans available to them. Child support payments can now be counted as income, bolstering many newly single parent’s ability to qualify for a mortgage.

• New Motivations

These factors may account for the ability of women to increasingly enter the home buying market, but there must also be motivation. The reasons that single women purchase homes probably isn’t much different than married couples seeking investment and asset growth or financial appreciation and emotional security benefits.

Women are marrying later or not at all. Census Bureau figures show the average marriage age of women at 26. The divorce rate, near 50 percent of all marriages, contributes to the number of women looking for homes of their own.

Women still outlive men by five years so many women downsize from the marriage home into smaller residences that they buy themselves after their husbands’ deaths. And women, are confident in their ability to maintain or even improve a home. A 2003 Forrester Research study found that nearly half of all purchases made in Home Depot and Lowes are made by women.

• New Support — Go for it, Girl!

A new book by Jennifer Musselman,author of Own It! The Ups and Downs of Homebuying for Women Who Go It Alone offers some practical tips and encouragement to this special category of homebuyers as referenced in the Nov. 16, Chicago Sun Times.

3 Tips from Own It!
1.) Get as much info as you can.
2.) Keep up with events in the newspaper or online that might affect the housing market in your area.
3.) Consistently monitor interest rates and loan options.

“The notion of buying a home alone was intimidating,” admits Musselman. “But beneath my anxiety, the anticipation of really purchasing a property all on muy own pulsated through my body. This was a chance to grow and prove to myself that I was capable of anything I set my mind to.”

Phil Lukan of Pulte Mortgage offers some positive insights for today's buyers.

Despite all of the news about our nation’s financial systems, we bring you an interview with Phil Lukan, Pulte Mortgage’s local branch manager.

Buyers in today’s marketplace have a lot of concerns when it comes to purchasing a new home (selling their current residence, qualifying for a loan, etc.). As someone intimately familiar with home mortgages, the qualification process and credit markets in general, what’s your perception of the current credit situation and what would you anticipate seeing as improvements in the near- to short-term?

Phil: Certainly the news can be deceiving when looked at superficially. But there are indications that the credit markets may start to ease up, mainly as a result of the federal government’s recent moves to shore up the economy, financial institutions and other measures through the recent bailout packages. The Treasury just recently indicated the $125 billion that is going to 9 major U.S. banks will begin to be deposited early this week.  The hope is that the additional funds will allow banks to open their doors to lending again and that will continue to help unfreeze the credit markets.

We’ve heard that many buyers are finding it difficult to qualify now unless they have spectacular credit scores. Is there any truth to this and does Pulte have any plans in place to allow buyers to become prequalified or even special financing programs once they’ve met qualification guidelines?

Phil: Most Qualification guidelines have been significantly tightened and the credit score “bar” has certainly been raised for all buyers. We’ve seen an end to certain types of financing programs, such as reduced documentation programs (Stated Income, No-Doc) and many 100% financing programs. Debt-to-income ratio guidelines are more stringent and downpayment requirements have also tightened, especially in developing markets that still hold a high level of overall credit risk.  In Illinois, legislation was passed which now requires lenders to verify the borrower’s ability to make monthly mortgage payments, which means “reduced doc” loan programs are no longer a financing option.

For a buyer who is looking to make a move into a new home, what strategies, tactics and preparations can they do now that will make the approval and closing process easier in the near future?

Phil: Come prepared with realistic expectations, all of your documentation in hand and accurate knowledge of what your current credit situation is.   An example of some of the documentation needed to make a credit decision includes last year’s W-2s and tax returns, recent pay stubs, and two months of asset statements.

How is the availability (and ease of process) of finding mortgage funding through alternative programs like FHA, VA and even private lenders? Has anything changed significantly, and if so, what should buyers be prepared for?

Phil: The private lending market is very tight now, but the hope is the ease in bank credit will translate out to more availability from private banks and lenders. FHA financing has not changed very radically and is widely available, though there are new guidelines and restrictions, such as an increase in the down payment requirement from 3% to now 3.5%.  FHA has also eliminated the seller’s ability to offer Down Payment Assistance as a means to help buyers with the required down payment.
For borrowers with credit scores below 580 — if they qualify — are required to have a 5% down payment.

Finally, what words of advice do you have for consumers who are facing difficulty in meeting their mortgage commitments?

Phil: Work with your current lender to come to terms both you and the lender can live with. Many consumers are walking away from their home mortgages now, not realizing that action will have a negative effect that will follow them for many, many years.

According to Mr. Lukan, 93% of Pulte homebuyers use Pulte Mortgage as their lender. When you choose Pulte Mortgage, you get a team of people from both Pulte Mortgage & Pulte Homes working together to support and guide every aspect of your mortgage experience.

Pre-qualifications are available at all communities by qualified Sales Associates prior to making any purchasing decision (though they cannot pull a credit report on the spot). Just remember that the more documentation and information you come armed with, the more accurate this entire process will be.

There is one thing for sure that came from the federal government coming to the rescue of Fannie Mae and Freddie Mac -- a bit of much-needed market stability.

According to a story broadcast yesterday on National Public Radio’s Marketplace show, the federal government takeover of mortgage giants, Freddie Mac and Fannie Mae, has resulted in at least one short-term positive — a drop in mortgage rates, making it a lot more attractive to buy a house this week than it has been recently.

Since the announcement late Sunday, the rate on 30-year fixed mortgages dropped a half point on Monday and have been falling ever since. While no one knows for sure what the eventual long-term cost or outcome of the federal government’s decision will be, it seems that the concensus is that the move has given the market some well-sought stability, at least this week.

Homebuyers should see the move as a good sign — according to Greg McBride, senior analyst at Bankrate, lower rates could make it easier for new homebuyers to get a loan and also bring new buyers into the market. He says this combination could slow the fall in housing prices.

Marketplace’s Dan Grech exclaims, “The bailout of Fannie and Freddie restored investor confidence in mortgages. That’s why mortgage rates have fallen so fast.”

No matter the reason, smart homebuyers should take advantage of at least this temporary drop in rates and consider a move soon into a new home. If you’re interested in discussing your options and the possibilities with one of our sales consultants, simply schedule an appointment online and we’ll answer any questions you might have.