Ask Kathy – July 14, 2017

Hi Kathy:

My partner and I have decided to move to Civita in Mission Valley as many of our friends have purchased there and they have nicknamed this master-planned community “North Hillcrest.”

I have always heard that the pricing of homes in gay neighborhoods increases in value. Is this just because of stereotyping or is it true and/or factual?

—John B.

Hi John:

Your question could not have had better timing as we honor diversity and gay pride this month of July 2017. Yes John, there is actual truth and information based on studies showing that homeowners in the housing market for 2012 had to pay an average premium of almost 29 percent or almost $209 per square foot to live in communities with a higher share of gay, lesbian, and bisexual residents.

There are other studies also posted according to Trulia that America’s gay neighborhoods recover faster than non-gay neighborhoods. Trulia teamed up with OKCupid to establish a “Neighborhood Pride Score” which uses U.S. Census data to locate gay couples. These researchers would then compare the data and analyze what the housing prices were. What they discovered is that the highest premiums for gay neighborhoods were in West Hollywood, the Castro district in San Francisco, Uptown in Dallas, Hillcrest in San Diego, and Edgewater in Chicago.

There are different theories and suggestions for this. Many gay couples have two incomes and no children supporting a higher-priced area or money for home improvements. Fewer children and more disposable income attract people to neighborhoods with desirable amenities.

Trulia also did a follow-up study after 2012 for the following next three years. They specify that gay male neighborhoods have risen in price per square foot value more than gay female neighborhoods. They say the average gay neighborhood increased by 23 percent. Since they cannot account for all neighborhood changes, they then calculated the percent of increase in homes in the following areas from 2012–2015 by zip code:

Gay male neighborhoods:

Palm Springs (92262) rose 65 percent.
Noe Valley/Glen Park/Diamond Heights, San Francisco (94131) rose 47 percent.
Palm Springs (92264) rose 38 percent.
Pleasant Ridge/Detroit, Michigan (48069) rose 37 percent.
Castro, San Francisco (94114) rose 36 percent.

Lesbian neighborhoods:

Redwood Heights/Skyline Oakland (94619) rose 64 percent.
Avondale Estates/Atlanta (30002) rose 52 percent.
Jamaica Plain/Boston (02130) rose 37 percent.
Castro/San Francisco (94114) rose 36 percent.
Guerneville, North San Francisco (95446) rose 24 percent.

Trulia then looked at these gayborhoods to see if they outperformed that particular city or area and found that almost all of them had higher increases in pricing than the city that they were located in as a whole. It seems that although gay male neighborhoods increased more in pricing, lesbian neighborhoods increased more in growth, grew faster and by a larger amount.

Another theory is that gay male neighborhoods are in areas that were already highly priced so they were not as affected by the housing crash. Also, lesbians have about a 2.5 percent higher chance of having children and thereby gravitate toward areas of good schools.

All in all, gay pride is the month to embrace diversity and accept people for who they are regardless of sexual orientation. We are also reminded to stop discrimination and violence against lesbian, gay, bisexual, and transgender. We may celebrate gay pride this month but we take pride all year when it comes to our vested interest as homeowners in great neighborhoods.

Thank you, John, for this great question and good luck in Civita!

Best,
Kathy