Pride (and prejudice) in homebuying

June is Pride month – a time for the LGBTQ+ community to celebrate progress towards acceptance and push for change. However, in the UK, LGBTQ+ people still face discrimination across their lives – even in housing.

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According to the 2021 Census, more than 1.3 million people in England and Wales identify as lesbian, gay, or bisexual, and 358,000 people identify as trans. However, young people who identify as LGBT are grossly over-represented within youth homeless populations according to The Albert Kennedy Trust. Almost one in four young homeless people identifies as LGBTQ+, and 77% of LGBTQ+ youth homelessness is reported as being caused by family rejection, abuse, or being asked to leave home.

When LGBTQ+ people experience social disadvantages, rejection, or discrimination for who they are, it means they are less likely to have the resources needed to enjoy the privileges that other heterosexual and cis people can take advantage of.

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For example, a young queer person who’s kicked out of their home and doesn’t have a permanent address won’t be able to register for a bank account. That makes it much harder – if not impossible – for them to get a safe job, save money and build credit. Already, they’ve been placed in a situation that traps them behind their peers simply for being LGBTQ+.

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Saving for a deposit is a difficult task in itself – ask anyone. According to Barclays, 56% of first-time buyers need help from their family to get on the ladder. But this task is even more challenging for queer folks who are less likely to have any support from family. 

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And they also often face wage discrimination at work. It’s currently estimated that LGBTQ+ people take home on average £6,703 less per year in wages than their straight colleagues. This makes it even harder for them to get a foot on the ladder as they’re less able to save.

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But the problem doesn’t stop there. Even once they have the deposit, LGBTQ+ folks are likely to face further discrimination from estate agents, solicitors, or social housing providers. 

We should all be working to right these wrongs, mortgage lenders included. Lenders have a responsibility to make sure that their products and services are designed to allow access for all, especially with the unique needs of LGBTQ+ people in mind. 

Stonewall Research from 2018 found that one in four trans people were discriminated against when looking for a home to buy or rent. And LGBTQ+ people have even been refused viewings, as one gay couple came to find in 2022 when they were told that the owners were “unwilling” to let them view or buy a house in south London due to “religious beliefs”.

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We should all be working to right these wrongs, mortgage lenders included. Lenders have a responsibility to make sure that their products and services are designed to allow access for all, especially with the unique needs of LGBTQ+ people in mind. 

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For example, one couple were denied a mortgage after Halifax failed to recognise their legal gender-neutral “Mx” title in their systems. This simple administrative error almost cost them their dream home. Lenders can and should do better. 

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LGBTQ+ hate crimes are on the rise in the UK, so it’s more important than ever for companies to step up and make sure they’re doing everything they can to support their customers in any way they can. Simply slapping a rainbow on their logo for one month a year and buying a float in a Pride parade isn’t enough.

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Because there’s still a long way to go, and it’s smart for queer folks to begin the homebuying process well-prepared. If you’re LGBTQ+ and are looking to buy, here are some things you can keep in mind:

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• Make sure you’re using your tax efficient investment and savings accounts, i.e. LISAs, to make your saving as efficient as it can be
• Prioritise building and maintaining a healthy credit score, as this can help keep you borrow more and keep your monthly mortgage payments lower
• Know your rights as a buyer, so you can protect and advocate for yourself and recognise discrimination if you see it
• Build and rely on a trusted support system to help you as you navigate the process
• Partner with a lender or broker who you can trust to advocate on your behalf and respect your identity and wishes

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As for us? We’re still working to make the homebuying process safer for everyone. For example, as part of our Consumer Duty, we monitor the conduct of our industry partners, like mortgage brokers, to ensure they’re treating all customers fairly – no matter who they are.

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We also have ways to help aspiring LGBTQ+ homeowners onto the ladder. Our deposit booster feature, which allows friends to contribute up to 100% of a house deposit that you can pay back over time, can be helpful for those who may not be able to access safe family support. Or, what might be considered “unconventional” groups could consider buying together with our dynamic ownership feature, which allows you to split your monthly payments however you like and build equity as individuals. They might not be right for everyone, but they offer a bit more flexibility than traditional mortgage products. 

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The work is far from over for us, but we’re committed to always increasing accessibility to homeownership for everyone – and we won’t stop until everyone who wants to own a home can realise their homeownership dreams. 

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