From the time she graduated from college in 1993, Annie McDonnell dreamed of owning her own home. She liked the idea of building equity rather than "throwing away money on rent" and living without landlord restrictions on her cat and dog. To save for a downpayment, McDonnell lived rent-free with her parents on Long Island, N.Y., and commuted to Scholastic Publishers in Manhattan, where she is a production editor. Last December, McDonnell, 29, bought a two-bedroom ranch near her parents. "It feels great to own my own home and do whatever I want to it," she says.
If you're a single woman and have thought about buying your own home, you're not alone. Single women are the second-largest segment of home buyers, behind married couples. They make up 18% of those who purchase a home, vs. 9% for single men, according to 1999 data from the National Association of Realtors. And, reports the U.S. Census Bureau, more single women owned single-family homes than rented them.
FEWER HURDLES. What's behind this trend? In large part, women have the same reasons as other people buying homes: to take advantage of tax deductions and to build equity. In addition, the sociological and financial barriers that once kept unmarried females from buying homes are crumbling. Government programs that encourage home buying have made it easier for single women and single mothers to qualify. And as women earn more, they're able to afford a home on their own. "Women care about their finances and want to take responsibility, rather than wait for a white knight to come along," says Peggy Cabaniss, a financial adviser in Orinda, Calif.
Cabaniss' daughter, Jenny, a 27-year-old software engineer in Atlanta, bought her three-bedroom house in May. "I asked myself if I really had to live in a one-bedroom apartment just because I'm single," she says. Tax benefits motivated Cabaniss, but she had some concerns about the commitment before she made it. The decision to buy came easier after she reassured herself "that this home doesn't have to be permanent."
For those who need some monetary assistance, there are programs that help all qualifying first-time home buyers with lower downpayments and interest rates. McDonnell, for example, qualified for a New York state program as a first-time buyer and single wage earner on a limited income. She received a 6.5% mortgage, a full percentage point below the market rate.
NO PENALTY. If you've owned a home before, you might still qualify for a first-timer's program. Each state has different criteria, and even within states you'll find differences between fees and services for the loans. Also, first-time buyers can withdraw up to $10,000 of their individual retirement accounts for a downpayment without incurring the 10% penalty. For Federal Housing Administration loans, single parents count child-support payments as income and not as expenses.
Of course, even if financing isn't a problem, some women shrink from the other huge responsibility that goes with homeownership: repair and maintenance. For small jobs, the women we've spoken to have all done some themselves--more than a dozen home-repair books are targeted to women. But Valerie Carlson, 34, a Stamford (Conn.) public-relations executive, decided early on she couldn't strip the floors or clean the furnace in the three-bedroom home she bought in March. "There is always someone to hire who can do what you need if you can't do it yourself," says Carlson. She also suggests women tap friends and family members for advice and guidance when making the big decisions. "I liked the house a lot, but I didn't buy until I got a consensus," says Carlson.
McDonnell, Cabaniss, and Carlson are also enjoying the less tangible benefits, like the sense of empowerment. Says Cabaniss: "It's a neat feeling to know that I [bought my house] all by myself and no one helped me." That's what I call financial security.
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