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When It Comes to Housing, LGBTQ Legal Protections Come With Bigger Price Tag

Scott Smith
2 min read
When It Comes to Housing, LGBTQ Legal Protections Come With Bigger Price Tag

LGBTQ Americans are paying more than other Americans for housing if they want to live in areas that protect them from housing discrimination, according to Zillow, the online real estate database company.

Currently, fewer than half of U.S. states have laws explicitly prohibiting housing discrimination based on sexual orientation and gender identity.

Housing Unaffordable for Many in Areas With LGBTQ Protections

The average cost of a home in areas with explicit legal protections for the LGBTQ community is $328,575—63% higher than areas with no protections. Buyers in Hawaii, Washington, D.C., and California—all places with legal protections in place—can expect to pay over 200% more than buyers elsewhere, although home values in Iowa, the only state with statutes specifically for protecting LGBTQ homebuyers, are 23% below the national average.

Many times, these buyers are making significant sacrifices to buy a house they can afford, including choosing homes in much worse condition, in less desirable parts of town, or of much less square footage than originally intended.

Typical Home Value in States with Statewide Protections for LBGT

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Related: Forget the American Dream—Renting, Not Homeownership, is the Path to Financial Freedom

Because high home values generally correlate with high rents, LGBTQ renters also feel the pain in their pocketbooks. Federal Fair Housing laws protect renters from being denied housing for their age, color, national origin, religion, sex, disability, and familial status. Though sexual orientation and gender identity are not on this list, there are protections for LGBTQ renters that can fall under the sex, disability, and familial status umbrellas.

young female hands with LGBT rainbow ribbon wristbands holding craft wooden house

A 2018 ruling in the U.S. Court of Appeals for the Seventh Circuit (Wetzel v. Glen St. Andrew Living Community) set a precedent for landlord responsibilities for protecting LGBTQ tenants from homophobic harassment by other tenants.

In the ruling, Seventh Circuit Chief Judge Diane P. Wood wrote, “Not only does [the Fair Housing Act] create liability when a landlord intentionally discriminates against a tenant based on a protected characteristic; it also creates liability against a landlord that has actual notice of tenant-on-tenant harassment based on a protected status, yet chooses not to take any reasonable steps within its control to stop that harassment.”

Related: The Interesting Influence Same-Sex Couples Have on Home Values (& How It Impacts Investors)

Federal Law Doesn’t Protect Against LGBTQ Discrimination

Still, there is no federal law that consistently protects LGBTQ individuals, so their housing discrimination complaints may go unheard. The list of Fair Housing Act protected classes doesn’t specifically include these tenants. The act could provide explicit non-discrimination protections for LGBTQ people in housing by adding “sexual orientation” and “gender identity” as protected characteristics.

Panoramic rainbow colors collection of doors in Dublin, Ireland

Zillow says it’s not likely that legal protections for LGBTQ people increase home values. Still, because these cities and states trend more expensive, the financial impact on LGBTQ buyers and renters is disproportionate.

“In addition to providing legal protections, there are other steps local and state governments can take to create housing markets that are more inclusive and accessible for LGBT people,” said Skylar Olsen, senior principal economist at Zillow. “We know LGBT buyers—especially LGBT buyers of color—are more likely to purchase affordable home types such as condos and townhomes.

“More local governments should work to allow more of these types of homes, opening up areas and neighborhoods that historically priced out many LGBT buyers. Legal protections for LGBT become more meaningful when people can afford to access them.”


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Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.