Which factor allows an owner to refuse rental based on sexual orientation or gender identity?

The correct answer indicates that an owner may refuse rental based on sexual orientation or gender identity when the property consists of two or fewer units occupied by the owner. This is significant because the Fair Housing Act, which prohibits discrimination on the basis of certain characteristics including sexual orientation and gender identity, includes exemptions for owner-occupied properties with up to four units.

In such cases, landlords have more flexibility in who they choose to rent to, primarily to protect the owner's personal living space. This means that in these specific situations, owners are not required to adhere to the same non-discrimination guidelines that larger rental properties must follow.

The other options do not provide legitimate grounds for refusing rental based on sexual orientation or gender identity. For example, simply prohibiting children or having a rental price exceed a certain limit does not pertain to or justify discrimination on the basis of sexual orientation or gender identity. Similarly, whether a building is newly constructed does not relate to the legal protections against discrimination defined in housing law.