Did the Supreme Court’s Obergefell v. Hodges Decision Increase Mortgage Demand Among Same-Sex Couples?

This study asks whether the Supreme Court’s 2015 decision in Obergefell v. Hodges, which legalized same-sex marriage nationwide, increased mortgage demand among same-sex couples. Using data from the Home Mortgage Disclosure Act covering nearly all U.S. mortgage applications between 1998 and 2019, the authors compared same-sex and different-sex couples before and after the ruling. They found that mortgage demand by same-sex couples rose by about 12% in states newly affected by the decision and by 15% even in states where same-sex marriage was already legal. These results suggest that national legal recognition strengthened financial confidence among same-sex households.

The Policy Scientist’s Perspective

This article examines one of the most consequential social policy rulings of the past decade—Obergefell v. Hodges—through the lens of economic behavior rather than legal doctrine. The study’s importance lies in showing how a Supreme Court decision can reshape financial markets and household decisions, extending equality’s impact beyond civil rights to economic integration. The use of the Home Mortgage Disclosure Act data provides strong statistical power and external validity. The difference-in-differences and triple-difference estimators credibly identify causal effects. The results—12% to 15% increases in same-sex couples’ mortgage demand—are both substantively meaningful and statistically robust. Overall, the article represents a careful, high-quality contribution to an emerging literature linking equality policy to measurable economic behavior.

Full Citation and Link to Article

Eilam, N., & Shahid, H. (2025). Measuring the effects of Obergefell v. Hodges: Revisiting same-sex marriage legalization and mortgage demand. Journal of Policy Analysis and Management, 1–31. https://doi.org/10.1002/pam.70058

Extended Summary

Central Research Question

This study investigates whether the U.S. Supreme Court’s 2015 decision in Obergefell v. Hodges—which legalized same-sex marriage nationwide—affected the financial behavior of same-sex couples, specifically their demand for home mortgages. The authors aim to identify whether national legalization increased mortgage applications among same-sex couples relative to different-sex couples and to determine whether this effect varied between states that had already legalized same-sex marriage (“Early Legalization States”) and those that had not (“Obergefell States”). More broadly, the paper seeks to quantify how a federal court ruling can influence economic decisions by extending legal recognition and social legitimacy to previously marginalized populations. By distinguishing between pre-existing state-level legalization and the subsequent nationwide ruling, the authors attempt to isolate the additional effect of federal legal certainty on household financial behavior.

Previous Literature

The paper builds upon a growing literature examining the economic and social consequences of marriage equality. Earlier research had focused primarily on the staggered rollout of same-sex marriage legalization at the state level, using this variation to estimate effects on outcomes such as adoption decisions, labor force participation, household income, health insurance coverage, mental health, and partnership stability. For example, studies by Alm et al. (2014), Carpenter (2020), and Trandafir (2015) found that legal marriage improved financial security and social well-being among same-sex couples. Miller and Park (2018), in particular, provided early evidence that same-sex marriage legalization increased mortgage demand, but their analysis covered only the pre-Obergefell period.

The existing research suggests that marriage legalization may increase relationship stability, enhance financial planning, and expand access to credit markets by allowing couples to pool income and assets. However, prior studies relied heavily on state-level differences and often assumed that the effects of federal rulings were equivalent to those of state legislation. The present paper challenges this assumption, arguing that national legal uniformity provides an independent source of certainty, potentially affecting behavior even in states that had already legalized same-sex marriage. The authors’ analysis contributes to this literature by estimating the distinct effect of the 2015 Obergefell v. Hodges decision on mortgage credit, while applying updated econometric techniques that address known weaknesses in earlier difference-in-differences studies with staggered treatment timing.

Data

The study uses data from the Home Mortgage Disclosure Act (HMDA), which captures information on nearly all U.S. mortgage applications submitted to regulated financial institutions. Covering the years 1998 through 2019, the dataset represents an unusually comprehensive record of mortgage activity, including both accepted and denied applications. The authors exclude refinancing and home-improvement loans to focus on new home purchases and limit their analysis to owner-occupied properties. The resulting sample includes approximately one-third of all mortgage applications filed during this period—still representing millions of observations.

Because HMDA does not identify sexual orientation directly, the authors follow established practice by classifying applications as “same-sex” when the applicant and co-applicant are recorded as having the same sex, and “different-sex” when they differ. While this proxy is imperfect—potentially including some parent-child or other non-romantic co-applicants—the authors argue that such misclassification should not systematically vary over time and therefore should not bias the difference-in-differences estimates. They further validate this proxy by showing that the share of same-sex applications at the state level correlates strongly (r = 0.6) with estimates of same-sex homeownership from the American Community Survey (ACS).

To reduce the risk of misclassification, the authors examine age distributions and note that a small proportion of same-sex applicant pairs have age differences consistent with parent-child relationships. Since this pattern remains stable over time, it should only attenuate effect sizes rather than generate spurious findings. In addition to HMDA, the authors draw on complementary data from the Behavioral Risk Factor Surveillance System (BRFSS) and ACS to estimate the proportion of same-sex couples in each state, as well as state-level covariates such as unemployment rates, demographic composition, and age distribution.

The richness of the HMDA data, particularly its national scope and detailed reporting requirements, provides a strong empirical basis for studying shifts in mortgage demand. The authors correctly note that this dataset offers an advantage over surveys, which often contain too few same-sex respondents for reliable causal inference. The near-universe coverage of HMDA applications substantially enhances statistical power and external validity.

Methods

The authors employ several variations of the difference-in-differences (DiD) framework to estimate how same-sex marriage legalization affected mortgage demand among same-sex couples. The first analysis revisits earlier work on state-level marriage legalization prior to Obergefell using an updated estimator developed by Borusyak, Jaravel, and Spiess (2021), which addresses biases that arise when treatment timing is staggered and effects are heterogeneous. This estimator imputes counterfactual outcomes for untreated periods, yielding unbiased treatment effects even in complex policy environments.

Building on this, the main analysis estimates the effect of the Obergefell ruling itself using a two-stage approach. The authors first compute within-state differences between same-sex and different-sex mortgage applications, before and after 2015. They then estimate separate models for (a) states newly affected by the ruling and (b) states where same-sex marriage had already been legal. By estimating these groups separately, they avoid a key bias in earlier literature—namely, that using early-adopting states as controls for late adopters could underestimate treatment effects, since the federal ruling likely influenced both groups simultaneously.

Formally, the authors regress the logarithm of mortgage applications on interaction terms between year indicators and a dummy for same-sex couples, controlling for domestic partnership laws, demographic covariates, and multiple layers of fixed effects. These include state, year, and orientation fixed effects, as well as state–year and orientation–year interactions where appropriate. Standard errors are clustered at the state level and weighted by state population. The authors also perform robustness checks using applicants without co-applicants as an alternative control group to verify that results are not driven by changes among different-sex couples.

Though the analysis cannot rely on randomization, the design provides credible causal identification under the assumption of parallel trends. The authors test this by displaying event-study graphs showing no significant pre-treatment trends. Moreover, their use of the Borusyak et al. estimator strengthens the methodological reliability, aligning the paper with current best practices in quasi-experimental policy evaluation.

Findings/Size Effects

The analysis yields consistent and statistically significant results across specifications. The authors first confirm that earlier state-level same-sex marriage legalization increased mortgage demand among same-sex couples by approximately 12%, corroborating prior estimates from Miller and Park (2018), though using more robust econometric methods.

Turning to the 2015 Obergefell decision, the paper finds that mortgage applications from same-sex couples rose by about 12% in states newly affected by the ruling and by roughly 15% even in states where same-sex marriage had already been legal. These findings imply that national legal recognition provided additional assurance to same-sex couples, reducing uncertainty about the durability of marriage rights and the security of shared property ownership. Importantly, the positive effects persisted over several years following the ruling, suggesting that the response reflected genuine shifts in household formation and financial planning rather than short-term pent-up demand.

The authors also report heterogeneity by gender. In line with prior research documenting higher marriage take-up rates among same-sex female couples, the increase in mortgage demand was larger for female-female pairs than for male-male pairs. At the county level, the effects were concentrated in metropolitan areas, where same-sex couples are more numerous and where mortgage markets are deeper.

These results are substantively meaningful. Given the scale of the mortgage market, even modest percentage increases represent large aggregate shifts in financial activity. The findings demonstrate that legal recognition can alter economic behavior through both material and psychological channels—by reducing legal risk and by signaling broader social acceptance. The estimated magnitudes are large enough to be economically significant, not merely statistically detectable.

Conclusion

This study provides compelling evidence that the Obergefell v. Hodges decision had measurable economic effects extending beyond the domain of marriage law. By using near-universal mortgage data and updated quasi-experimental methods, the authors isolate the causal impact of nationwide marriage legalization on credit market participation among same-sex couples. The findings confirm that legal uniformity can enhance financial confidence and market engagement, even among individuals who were already legally protected under state law.

The study’s strengths lie in its comprehensive data coverage, credible causal design, and attention to policy heterogeneity across states. The difference-in-differences and triple-difference estimators used here represent state-of-the-art approaches for evaluating non-random policy changes. The authors are transparent about limitations—most notably, potential misclassification of applicants and the absence of direct sexual orientation identifiers—but they demonstrate that these issues likely bias estimates downward rather than upward.

The results have implications beyond the immediate context of marriage equality. They illustrate how federal judicial rulings can influence behavior by resolving uncertainty and establishing durable rights, thereby affecting markets as well as morals. The methodology could be applied to study other domains where Supreme Court decisions shape access to economic opportunity—such as reproductive rights, anti-discrimination protections, or educational equity.

In summary, this paper stands as one of the most methodologically careful and policy-relevant analyses to emerge from recent research on equality and economic behavior. It not only updates earlier work with modern causal inference techniques but also deepens our understanding of how social and legal change translates into measurable shifts in household financial activity. At a time when the durability of Obergefell itself faces renewed scrutiny, the study underscores the tangible economic stakes of constitutional rights. Its empirical rigor, large-scale data, and nuanced differentiation between federal and state effects make it a significant addition to the literature on law, inequality, and economic decision-making.