With apologies in advance that this blog isn’t the jolliest place to be, I do want to tangle with some critical topics as well as being here for encouragement on these journeys. There is so much content out there about how easy financial independence is – just get out there and do it!! – but it doesn’t ring true for me. It is absolutely not impossible, but if the system is stacked against you, you will feel the burn a hell of a lot more. And for me, I am comfortable in both looking at my own journey and how it’s working, and what is going on out there which is impacting others – and what some of this means for equality.
I’ve written a lot about specific elements of the system and how it works either for or against particular minorities (check out posts on how racialised the financial systems are plus the financial constraints and stacked barriers for single mothers. I also want to say up front that I recognise the privileges that I come with so I am not saying this to ‘own’ or appropriate these issues, but to talk openly about areas where and how I am tangling with them personally. In my view, refusing to acknowledge how systemic power structures work is part of institutionalising privilege in order to extend it’s power, so calling it out has to be part of how we can meaningfully respond. I also find it both essential to understand in terms of why things feel like they move so slowly for me.
This week’s post was kicked off for me by reading an article about why single women in the UK cannot afford to buy a home based on an excellent 2019 report with the same title as this blog post. House prices in the UK are unaffordable for so many that those on median wages – which includes nurses and frontline health care workers – will not be able to access a mortgage in more than three-quarters of the country. This has greater implications for women, because women are more likely to be in low paid jobs and are also more likely to work part time due to caring responsibilities.
The impact on being able to buy is significant. Women need over 12 times their annual salaries to buy a home in England: a whacking 50% more than men, who need eight times. In London and the South East, which are both the most expensive areas of the UK and the two where the gender pay gap is largest, women need 18 times their annual earnings. Given that the very most British mortgage companies are likely to lend a maximum of five times annual earnings – an amount which is anticipated to reduce as inflation bites – it means that these women will never be able to buy a home without external support.
There were two other statistics which felt like a slap in the face. Firstly, there is no region in England where private rented housing is affordable on a woman’s median earnings. This is not true for men, where this is only the case in London. Secondly, single mothers are two-thirds of all statutory homeless families with children (i.e. the groups of people for whom the State has to take some responsibility), a figure which is striking when they are only one-quarter of all families with dependent children.
Basically there is zero chance to single women on median incomes and don’t have any additional financial support to either buy or rent in the majority of the UK. That feels pretty terrifying to me. I earn a (significantly) above average salary and managed to get on the housing ladder early. But under these socio-economic shifts my mum as a frontline worker and single parent would not have been able to buy a house, something which would have seriously impacted on our security growing up; how well she will manage in her old age; and what generational wealth looks like. And what does it mean for my daughter and how I should help her plan for her future?
So what is the point of this post? I am not on a median income, and I own both a home we live in and a rental. I haven’t been able to get to the point where I can leverage them into any kind of real estate empire though which seems to be some magic formula for at least those in the US working on FIRE but I am unbelievably blessed to even just have a foot on the ladder. Some days I need to both recognise the luck that I have had in the draw, and how things are looking for others. And why this should matter for all of us: we never journey alone.
Quick reminder to come and join me (and the FIRE community) on Instagram @brilliantladiesmoney I am probably more fun there 😀
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