A new report helps agents better understand the preferences, drivers and challenges for LGBTQ+ buyers.
The LGBTQ+ community, like all underserved groups, has specific needs — and faces unique challenges — when it comes to homeownership. A new report sheds light on some of those needs and barriers, and notes how the homeownership experience for LGBTQ+ people may be changing.
The third-annual Journey to Homeownership report from the LGBTQ+ Real Estate Alliance, which offers a sweeping view of the real estate experience for LGBTQ+ people, provides real estate professionals with a wide range of insights into the community of LGBTQ+ buyers, sellers and homeowners. Top takeaways from the report include the main drivers for purchasing a home, motivations and considerations, and a demographic overview of the community.
Formalizing relationships leads to homebuying
The ability of couples to "formalize" relationships — resulting in part from the legalization of same-sex marriage on a national level, which occurred less than a decade ago — tends to lead to home purchases, particularly among lesbian women. The report, which surveyed more than 400 LGBTQ+ Real Estate Alliance members, found that 58.4% of lesbians said being in a formal relationship was a top reason for buying their first home, compared to 53.8% of straight couples and 34.3% of gay men.
Ryan Weyandt, CEO of the LGBTQ+ Real Estate Alliance, noted that the increasing number of same-sex marriages since the Supreme Court's ruling in 2015 has led to more LGBTQ+ people becoming parents, another common driver for homeownership or upsizing to a new home. About 16% of survey respondents said having children or growing their families was a top reason for buying their second home. Not surprisingly, schools become a higher priority in that second home purchase.
"We now have much greater insight into how relationships, engagements and marriage are having such a powerful impact on homeownership and where our community chooses to live," Weyandt said, noting that same-sex marriage definitely plays a role in securing long-term financial security through homeownership.
Motivations for choosing a first home
At the start of their careers, members of the LGBTQ+ community are more likely to opt for an urban setting, according to the report.
Nearly 70% of gay men in the survey reported that the first place they lived on their own was in an urban center, compared to 45.5% of lesbians and 42.4% of straight respondents. That was likely due to the greater importance gay men placed on living in an area with nightlife and a dating/social scene compared to lesbian and straight respondents.
The No. 1 motivation for both gay men and straight people when choosing a home at the start of their professional career was job opportunities. For lesbians, the top motivation was housing affordability.
As a group, LGBTQ+ buyers were more likely to purchase their first home in an urban area — 46.6% of LGBTQ+ buyers did so, compared to 32.8% of straight buyers — while a nearly equal percentage of straight buyers (47.8%) chose the suburbs when making their first purchase. Notably, the preference to remain in an urban setting was much stronger for gay men. Lesbians were the most likely of all respondents to buy their first home in the suburbs.
By the time buyers had purchased their third home, however, the urban-suburban split among the LGBTQ+ community was much smaller.
Where housing discrimination shows up in the homebuying process
In the past, real estate agents were most often cited as the top contributor to discrimination during the homebuying process, according to the study. While that number has decreased, 19.8% of respondents indicated that agents were the leading source of discrimination.
But a higher percentage pointed to required forms and discriminatory sellers as primary culprits.
Forms and other legal documents that don't accurately represent the life experiences of LGBTQ+ people were cited as a leading cause of discrimination 20.3% of the time, followed closely by sellers, at 20.1%.
The number of LGBTQ+ Real Estate Association members who said they believe discrimination against LGBTQ+ potential homebuyers has increased over the last three years went up somewhat significantly, with 21% of respondents perceiving an increase in discrimination vs. 17.9% a year ago.
The impact of anti-LGBTQ+ legislation
The introduction of more than 340 anti-LGBTQ+ bills in various state legislatures in 2023 is also having an impact on homebuying decisions, according to alliance members quoted in the report.
Amy West, a LGBTQ+ Real Estate Alliance member in Durham, North Carolina, helped three couples move into the state last year from Florida. She said they listed the politics around anti-LGBTQ+ legislation as a top reason for moving. Other homebuyers mentioned in the report also noted they are closely watching the political process and wondering whether they still feel safe or if they need to move.
"Almost every LGBTQ person I'm having dinner with or talking to or whatever has in the back of their mind: What is my Plan B?" said Bob McCranie, a real estate agent from Dallas, Texas, who launched a program to help those thinking about leaving the state. He noted that some LGBTQ+ people want to stay and fight the legislation, but he expects to see more migration out of states that have similar anti-LGBTQ+ legislation.
