DURHAM – Homeowners who identify as LGBTQ+ face many challenges when it comes to home ownership, even though a new survey finds that they are on average younger and live in urban environments.

“This seems more of an age thing—more young people identify as LGBTQ+—than anything else,” said Dr. Kate Bruce, a Triangle homeowner who recently purchased a home in Durham with her wife.  “It glosses over the many structural inequalities LGBTQ+ people face.”

LGBTQ+ owners are more likely to live in smaller homes with fewer bedrooms than cisgender homeowners, a recent analysis conducted by Zillow Group concluded.

Zillow analysts found that many people who identify as LGBTQ+ face disproportionate challenges compared to their cisgender, heterosexual peers—especially people who are lower-income or people of color—in a prior analysis of data from the 2020 and 2019 Zillow Group Consumer Housing Trends Reports.

The most recent analysis notes that the findings “help shed light both on some of the potential drivers of inequality between the LGBTQ+ community and others, and how the LGBTQ+ community is overcoming barriers to homeownership.”

For instance, Zillow analysts found that the median age for homeowners who identify as LGBTQ+ is 44, younger than the median age of cisgender, heterosexual homeowners, which was 59.  Further, according to self-reporting, 28% of LGBTQ+ homeowners live in an urban area, whereas 1 in 5 cisgender, heterosexual homeowners report the same.

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Legal protection lackaing

Lesbian, gay, bisexual, or transgender (LGBT) persons are not expressly listed as protected classes under FHA or the North Carolina State Fair Housing Act.  Federal fair housing law does protect seven classes, but gender identity is not one of these.

Further, in North Carolina, a same-sex married couple cannot currently receive the title to real property as tenants by the entirety, which Ward and Smith, PA, describes in a blog post as a hybrid of common law and statutory law.

Tenancy by the entirety is the preferred form of concurrent ownership for married couples due to four primary benefits of this ownership structure.

  • First, tenancy by the entirety permits the property to be held by the married couple as a family unit.
  • Second, the property cannot be transferred or encumbered by either spouse without the consent and joinder of the other, or in other words, in order to sell, mortgage, or otherwise encumber the property, it requires both spouses to consent and to sign a valid legal contract.
  • Third, the creditors of only one spouse cannot reach the property, and
  • Fourth, the right of surviorship is automatically included, meaning that a surviving spouse will be guaranteed to vest title in the property following the death of their spouse, without passing through the estate of the deceased spouse and becoming liable for the debts of the estate.

In North Carolina, though, tenancy by the entirety can only exist between a husband and wife.

“Two people who are not husband and wife cannot own real property together as tenants by the entirety,” the blog post states. And even where legal protections do exist, Zillow found that potential homeowners who identify as LGBTQ+ may be priced out of the real estate market, as data suggests a price premium.

According to the North Carolina Real Estate Commission, there are five jurisdictions in the state that have local fair housing ordinances certified by HUD as “substantially equivalent” to federal FHA: the City of Durham; the City of Greensboro; the City of Winston-Salem; Orange County; and the City of Charlotte-Mecklenburg County.

“These jurisdictions receive federal funding under the Fair Housing Assistance Program to investigate and attempt to resolve complaints within their area,” a training file on fair housing published by the Commission reads.

The Department of Housing and Urban Development (HUD) does have regulations to “ensure that its core programs are open to all eligible individuals and families regardless of sexual orientation, gender identity, or marital status,” the brochure notes, which does mean that persons who identify as LGBT and who believe they have experienced housing discrimination may be able to file a claim based on any or all of the following: the Fair Housing Act; HUD’s equal access rule; or state and local anti-discrimination laws.

“Due to HUD’s expanding policy for fair housing to all eligible individuals and families regardless of sexual orientation, gender identity, or marital status, brokers should realize that discrimination in housing based upon LGBT considerations may violate FHA,” the publication reads.

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Safety, proximity, finances all important considerations

Bruce purchased a home, with her wife, in 2016.  “We benefited from a generous gift from family, which enabled us to buy at that time,” said Bruce.  “Many LGBT people do not receive that support, both because of structural inequalities—race, class—and because of rejection from family when they come out.”

The key factor in their search: safety.  Proximity to their jobs was also important, but safety was paramount.

The Zillow analysis also found that homeowners who identify as LGBTQ+ are about three times more likely to report that they are currently renting out a part of their home, noting 15% of LGBTQ+ homeowners, compared to 4% of cisgender, heterosexual owners.

The house Bruce and her wife purchased was a 3-bedroom single-family residence, and after the purchase, became a landing spot for a friend in need of a temporary place to stay, said Bruce.  “It worked out that we had the space we could offer to our friend,” said Bruce.  “After he moved out, we decided to try our hand at AirBnB to make some extra money.”

Overall, said Bruce, it was a good experience, though there were a few guests who expressed surprise that their hosts were a married couple, not roommates.  “Our most memorable was the woman who asked which was each of our rooms, and didn’t seem to understand when we said we shared the master bedroom,” said Bruce.

There are underlying issues that the Zillow study may not fully capture in analysis, Bruce added.  A key factor for many individuals and couples who identify as LGBTQ+ in selecting housing is safety.  “Of course, LGBT people still do not have protection from employment discrimination, which affects trans folks particularly hard,” said Bruce.  “As two women, we do not have access to male privilege in employment and salaries, so our household income is likely less than it would be if one of us were male.”

As mortgage lenders often treat household income as a key factor in assessing and approving a mortgage, it’s possible this structural issue contributes to limiting housing options for those who identify as LBGTQ+, as well.

“Most LGBTQ+ buyers must then secure a mortgage, presenting another challenge,” a Zillow analysis reads.  “A third (33%) of LGBTQ+ buyers that take out a mortgage are denied at least once before ultimately getting approved, compared to 19% of cisgender heterosexual buyers with a mortgage.”

Zillow found that for people of color who identify as LGBTQ+ and seek to purchase a home, 42% reported being denied at least once prior to approval.

“The finding from Zillow is probably more about age and finances than about LGBT identity,” said Bruce.

Zillow notes that the third-party firms that conducted the surveys on which their analysis is based used quotas for age, education, sex, region, race/ethnicity, and marital status, in order to limit oversampling of any given demographic group.

“In addition to quotas, ZG Population Science and YouGov used survey weighting to sample characteristics matched the U.S. Census Bureau American Community Survey 2017-2019 samples of homeowners,” Zillow said.

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