LGBT+ Homeownership: Current Stats and Support Systems

Just under half of the LGBTQIA community are homeowners. That’s significant, when the U.S. average rate of homeownership is so much higher, at 65%.

It’s not that the LGBTQIA community rents by choice. (Only 11% does.)

So, what’s the story?

What U.S. Courts, Laws, and Agencies Are Saying

In 2016, the U.S. Consumer Financial Protection Bureau (CFPB) received and responded to questions about mortgage approval bias from the nonprofit group Services and Advocacy for Gay, Lesbian, Bisexual, and Transgender Elders (SAGE).

In its reply, the CFPB made a statement on the Equal Credit Opportunity Act. It interpreted the law’s protections as follows:

  • Regulation B of the Equal Credit Opportunity Act supports “broad protection from discrimination” on account of a mortgage applicant’s “sexual orientation and gender identity.”
  • The federal regulation further prohibits discrimination on account of nonconformity (real or perceived) with traditional sex or gender norms.
  • Discrimination based on a loan applicant’s social associations is also against the law.

Fast-forward to 2020. That year, the U.S. Supreme Court issued its milestone ruling in Bostock v. Clayton County, Georgia. The Supremes held that Title VII of the Civil Rights Act of 1964, with its prohibition against sex bias, does indeed bar discrimination on account of sexual orientation or gender identity.

And then, in 2021, the Department of Housing and Urban Development (HUD) declared that the U.S. Fair Housing Act’s sex discrimination language includes bias against sexual orientation and gender identity. Therefore, a consumer facing housing discrimination or mortgage bias based on sexual orientation or gender identity (real or perceived) may file a complaint with HUD, under the Fair Housing Act.

Also in 2021, the White House agreed with the declarations of HUD and the Consumer Financial Protection Bureau.

So the courts, agencies, and the White House too, are all on the same page. In the world of real estate and home loans, discrimination on account of gender identity or sexual orientation is not allowed.

OK, now what is actually happening in the world of home buying experiences?

LGBT+ Home Buying Experiences

People within the LGBTQIA community are less likely than other households to live in multigenerational homes. More than the average, they buy condos, duplexes, and townhouses.  

And there’s another big difference, too. Many LGBTQIA home buyers (as compared to the general population) move away from the areas where they were raised.

Overwhelmingly, people in the LGBT+ community prioritize living in a safe, supportive area. Every home buyer, of course, wants to choose a home in a safe and secure place. For these buyers, though, living in a safe and secure place can mean searching for known LGBTQIA-friendly places. Among these areas are Palm Springs and San Francisco, California; New Orleans, Louisiana; Portland, Oregon; and New York City.

States such as Vermont, Maine, California, and Maryland have laws that specifically support LGBTQ+ rights. Some states, like Washington state, expressly bar medical insurance firms from discriminating on account of sexual orientation or gender identity. Factors like this make certain places more appealing than others for LGBT+ buyers.

Sometimes, though, hopeful home buyers work in less helpful states. Or perhaps they cannot afford a mortgage in, say, California, Maryland, or other LGBT-supportive states.  

Credit tangles might also create obstructions. A credit bureau knows how to accommodate name changes on credit profiles. Plenty of people, for plenty of reasons, petition for name changes with their county courts. Yet transgender and nonbinary loan applicants often have a harder time transferring their credit data into their new names, reports Dawn Papandrea at The Balance:

To initiate a name change, individuals must explain to their creditors why they wish to do so. When this happens, the credit history under their former name often fails to transfer, according to nonprofit Center for LGBTQ Economic Advancement & Research.

In this way, people can be ruled out at the start from applying for home loans — even if they’ve had perfect credit in the past.

“Formerly known as”: Here’s when and how a homeowner should have a name change reflected on the house deed.

As noted above, legislation, litigation, and policy changes now prevent bias against members of the LGBTQ+ community. This has raised awareness in the credit world, providing straightforward access to credit for more home buyers.

And lenders themselves reap the benefits of evolving policy. The LGBT+ community represents $1 trillion in buying power!

Facing Discrimination and in Need of Help?

Everyone in the nation has a right to housing opportunities. And no one should be subjected to discrimination simply because they happen to be a member of a particular social group. If you are concerned about facing discrimination during home hunting, one resource is the LGBTQ+ Real Estate Alliance. The group can help you find a real estate agent who’s tuned into your concerns. 

If you do experience discrimination through the home loan application process or any stage of your journey to home ownership, there are a number of other groups you can contact. You may:

  • File a claim with your state Association of Realtors®.
  • File a claim with the federal department of Housing and Urban Development.
  • Submit a complaint to the relevant state or local civil or human rights office.
  • Report the issue to the Consumer Financial Protection Bureau.

The Consumer Financial Protection Bureau is a key agency. It enforces the Equal Credit Opportunity Act and ensures that lenders abide by its provisions. As it has stated, it “will not tolerate illegal discrimination against the LGBTQ+ community.”

And yes, renters are protected by federal anti-discrimination law, too. Under the Fair Housing Act, property owners, managers, and agents may not reject an applicant on account of sex or gender identity.

One final but important note: We cannot provide case-specific legal advice. No website can. Whether buying or renting, consider setting up a consultation with a civil rights lawyer if your rights or finances are impacted.

Our Takeaway

Hopeful homeowners in the LGBT+ community are looking to buy for the same reason everybody else is. Yet just 49% of adults in this group own their homes. Their rate of mortgage approvals is clearly lower than average. While pay scales and hiring biases do play a role, discrimination in real estate is also part of the picture. But so is legal recourse.  

Supporting References

U.S. Consumer Financial Protection Bureau: CFPB Clarifies That Discrimination by Lenders on the Basis of Sexual Orientation and Gender Identity Is Illegal (Mar. 9, 2021).

Bostock v. Clayton County, Georgia, 140 S. Ct. 1731, 207 L. Ed. 2d 218 (2020).

Sara Coleman for Bankrate, LLC (a Red Ventures company) via LGBTQIA Homeownership Facts and Statistics in 2022 (Jun. 2, 2022; citing the National Association of Gay and Lesbian Real Estate Professionals’ 2020-2021 report and National Association of REALTORS® – 2021 Profile of LGBTQ Home Buyers and Sellers – NAR 2021 Profile).

Dawn Papandrea for The Balance (Dotdash Meredith publishing company): How Trans and Nonbinary Homebuyers Can Navigate Mortgage Applications (updated Jul. 29, 2022). Also see Casey Bond for The Balance: Why LGBTQ+ Homeownership Is Below the National Average (updated Jan. 17, 2023; citing data from Freddie Mac and the U.S. Census Bureau).

And as linked. Photo credits: Marta Branco and Cottonbro Studio, via Pexels.