TheMReport — News and strategies for the evolving mortgage marketplace.
Issue link: http://digital.themreport.com/i/1133509
52 | TH E M R EP O RT O R I G I NAT I O N S E R V I C I N G DATA G O V E R N M E N T S E C O N DA R Y M A R K E T THE LATEST DATA Time to Break Social Barriers What's keeping LGBT homeownership rates low? The answer could lie in social challenges rather than financial ones. T he historic Obergefell v. Hodges Supreme Court decision in June 2015 that legalized same-sex marriages has gone a long way in helping the lesbian, gay, bi- sexual, and transgender (LGBT) community toward a broader recognition and legal assurance of their rights. Despite this, however, LGBT homeownership remains 16% below the national average according to a report by the National Association of Gay & Lesbian Real Estate Profes- sionals (NAGLREP) that was published in partnership with Freddie Mac. According to this report, one of the biggest barriers to home- ownership for the LGBT renter is not unlike that faced by most homebuyers—saving up for a down payment. Seventy percent of LGBT individuals surveyed by Freddie Mac listed this as a top chal- lenge, whereas 81% of NAGLREP members cited lack of funds for a down payment and waiting for the right time to buy as the top hurdles keeping this demographic from owning a home. However, the community not only fears discrimination within the communities/neighborhoods where they may choose to buy, they also worry their mortgage might not be approved or their of- fer on a home might get rejected. The report indicated that, while 44% of those surveyed cited anxi- ety about how welcoming com- munity and neighbors might be as a concern, 20% and 22% said that they feared their mortgage would not be accepted or that their offer might get rejected, respectively. These fears might not be unfounded. The Washington Post recently reported that gay couples were 73% more likely to be denied a mortgage than heterosexual couples with the same financial worthiness. Citing a study by the Ivy College of Business at the Iowa State University, the report said that when same-sex couples were approved for a loan, they paid 0.2% more in interest and fees. Despite these concerns, the NAGLREP report said that the future for homeownership for the LGBT community is bright, espe- cially with the reintroduction of the Equality Act in Congress. This bill would amend the Civil Rights Act of 1964 to prohibit discrimination on the basis of sexual orientation and gender identity in employment, public accommodations, public education, federal funding, credit, the jury system, and housing. If the Equality Act ultimately passes, it will pave the way for a future where LGBT individuals are pro- tected from discrimination. In fact, this bill was a key point of discussion at the four LGBT town halls conducted by the American Mortgage Diversity Council (AMDC) in 2018. This series of AMDC Town Halls cul- minated in the creation of a white paper report that was circulated to thought leaders across the country, including mortgage industry leaders, housing policy experts, and partici- pating LGBT organizations. Heating up Homebuyer Interest A new report spotlights energy efficient features helping sellers to get sweet deals on their homes. A new report by Zillow shows that homes with solar-energy systems sold for 4.1% more on average than others nationwide in the past year, and more than 80% of home buyers say energy- efficient features are important. "Energy conservation isn't only good for the environment, it can also translate into big savings on electricity bills as well as help to reduce the strain on the electrical grid," said Sarah Mikhitarian, Senior Economist for Zillow. Zillow utilizes a figure they call the "Sun Number," which measures the roof of each home and calculates the pitch, orientation, and size of each roof plane. The Sun Number determines the amount of sun that hits every square meter of the home's roof, taking into account factors like trees or taller buildings that might block sunlight. Finally, it adds in local factors like the cost of electricity and solar, and the local weather conditions, to compute a Sun Number somewhere between 0 and 100. The higher the score, the more suitable for solar that house is. "The Sun Number provides a starting point for potential energy savings, but speaking with a local expert can help homeowners decide whether it pencils out," Mikhitarian said. "Homes with solar-energy systems often sell for more than comparable homes without solar power. This premium is largely reflective of the future energy cost savings associated with system." The National Association of Realtors reported last year in a survey that 71% of its members felt that the promotion of energy efficiency in their listings was either somewhat or very valuable. Las Vegas (93) has the nation's highest Sun Number. It is followed by Phoenix (90); San Jose, California (90); and Los Angeles-Long Beach- Anaheim, California (89). Seattle (69) and Detroit (67) have two of the nation's lowest Sun Numbers. The national median Sun Number is 78. Currently, there are enough solar-electricity systems installed in the U.S. to power 12.3 million homes. Zillow is reporting that number is likely to grow as California is requiring all new homes have solar power in 2020. Currently, there are enough solar-electricity systems installed in the U.S. to power 12.3 million homes.