In the Victorian era it was said that “An Englishman’s home is his castle”, but with an increase in social renters and hurdles to home ownership in the last century, Samir Jeraj asks is this goodbye to our dream of ownership?
In the Victorian era it was said that “An Englishman’s home is his castle”. Apt when only 20% of people owned a house. However, by the 1940s, the iron railings which marked these castles were being sawn off to fuel the collectivist war effort. This was much to the ire of Evelyn Waugh, who wrote a letter to the Times in 1942 complaining about it. Socialist and liberal politicians moved people out of the private-rented slums, and into modern council and social housing. However, the Thatcherite revolution 1979-1990 unleashed a wave of state-subsidised home ownership. Expanding home ownership was seen as the answer to a series of questions about how to create economic growth, how to counter social problems, and how to create a stable (and conservative) ‘property-owning democracy’. Now that vision of making us all Victorians is under threat from without and within.
The argument over the relationship between home ownership and democracy in Britain can be traced back to the Civil War. It was Henry Ireton in 1647, arguing against universal (male) suffrage, who said:
“no man hath a right to an interest or share in the disposing of the affairs of the kingdom… that hath not a permanent fixed interest in this kingdom.”
And hence establishing the idea that in order to be a full citizen, one needed to own property. This tension between ownership and democracy played out in Britain over the next three centuries. In the run up to the 1832 Great Reform Act, the Duke of Wellington wrote to a colleague in Vienna that:
“I don’t believe that there is a man in England who does not think that this Reform must lead to the total extinction of the power and property of this country.”
This was the reaction of one of the most powerful men (who had been Prime Minister in 1829) to a bill which extended the vote to people who had property worth £10 at the time. The total number of voters expanded from 400 000 to 650 000 (about 5% of the population). Over the next century, the ‘property qualification’ was gradually reduced by acts in 1867, 1884, and finally abolished when women were granted the vote in 1918. At each stage Tories and Conservatives declared the reform to be ‘the end of property’. However, against this tide of reaction was another conservative tradition which envisioned using property ownership to create a stable society under democracy. This was captured by Thomas Macaulay MP when he called the 1832 Act ‘Reform that you may preserve’ and was brought into the modern era by Noel Skelton MP when he called for a ‘property-owning democracy’. From 1979, this became the mantra of first the Conservatives, and then the Labour Party.
However, in 2003, for the first time since 1900, the number of home owners started to fall. By 2007 it had become clear that Greece, with one of the highest levels of home ownership in the world, was in serious economic difficulties. In 2008, the US government under the Presidency of George Bush took into public ownership two massive organisations designed to support affordable mortgages and home ownership. The dream of a property owning democracy was starting to collapse.
Take a look at home ownership levels in the EU prior to the current economic crisis and you won’t find that there is a strong relationship to those countries weathering the economic crisis well. Instead, there is a surprising correlation to countries with major economic problems (Greece, Ireland, Spain, Belgium and the UK):
By 2010, the Chartered Institute of Housing declared that ‘The Love Affair of owner-occupation is over’. The National Housing Federation CEO had already laid out the impact on housing a year earlier, saying: “We have used it [home ownership] as the policy determinant and that's absolutely wrong," and that the policy "has been a disaster". This was elaborated by the Joseph Rowntree Foundation whose report on the Housing Market stated that the policy of encouraging ownership had resulted in four housing bubbles in 40 years, skyrocketing prices, a rise in social exclusion caused by repossession and arrears, a poor safety net, and insecurity in housing.
The future prospects for owner-occupation definitely do not look good. The term ‘Generation Rent’ was coined by the Halifax to describe those aged 22 and 45, of whom just 5% had the finances to save for buying a house. The CiH’s own survey exposed a picture of high cost housing which was leaving little or no ‘disposable income (cash) for more than 20% of people. Indeed, housing has been identified as one of the battlefronts of intergenerational conflict. Generation Rent is also the generation who have seen the imposition of tuition and student fees, rising professional unemployment, and falling standards of living. They have been nicknamed the ‘Baby Losers’ in Spain, Italy, and France.
Research by the Intergenerational Foundation entitled 'Hoarding of Housing' identifies a number of intergenerational issues in UK Housing: Under-occupation encouraged by the tax system and meaning there are 25 million unused bedrooms in the UK (a trend which has increased, meaning that 33% of all housing is under-occupied.) Rent has increased in the past 8 years by an average of 50%, and more in areas where there are jobs. Resentment of this situation amongst young people is growing. Class inequality has given way to intergenerational inequality. In 1981, over 30% of owner-occupiers were aged 16-24 - now they are around 15% of owner occupiers. By contrast, owner-occupation amongst those aged over 75 have gone from just under 50% to just over 70%.
Housing in Britain has always been infused with class relations. Lynsay Hanley stated in her book Estates that the type and tenure of housing we live in is one of the clearest class distinctions in the UK. In 2003, the Joseph Rowntree Foundation conducted research which concluded that ‘housing tenure was the most influential factor in determining poverty closely followed by social class of the head of household’.
As I mentioned earlier, for conservatives home ownership had been a plank of their vision of a stable society since the term ‘property-owning democracy’ was coined by Noel Skelton in the 1920s. According to this view, a property-owning working class would inoculate the masses from socialism. In the era of Blair, housing was recast by New Labour as ‘capital assets’ and the debate reframed to look at how to create equality through including more people the housing market. This was to be a classless society, with all driven by aspiration to ownership. This was electorally easier than taxing the assets of the rich, and fitted the neoliberal ideology of the time. All throughout this time, social housing declined – from 21% of households in 1997 to 17.7% in 2008.
Social rented home building went through two phases of collapse after 2008. The first wave was the collapse of big regeneration projects undertaken by Councils in partnership with private developers. These depended on a buoyant house market to subsidise the cost of building social housing. Once profits fell, so did building with some developers finishing off or renegotiating their projects and others holding on to derelict sites in the hope of a quick economic recovery. The Labour government sanctioned this by allowing planning permission to be held over.
The second phase began with the election of a Conservative and Liberal Democrat government committed to quick and deep spending cuts as the route out of recession. Funding for new build social housing vanished, and the generous debt settlement to councils who wanted to build new council housing was increased meaning fewer new build council houses than had been hoped.
The credit crunch and the recession have put an end to what was already an unsustainable housing bubble, and now the ideological cuts to social housing have seen massive growth in waiting lists. The next decades will be dominated by private renting. The irony is that most housing professionals seem to agree that this could be a good thing, and that we can point to successful countries with a thriving renting, social renting and co-op housing sectors. The time has come to expose the problems with private rented housing, build a tenants movement, and create change from the grassroots.
Samir Jeraj was a Green Party Councillor from 2008-2012. He has an MA in Development Studies from the University of East Anglia and a BA in History with Economics from the University of York. His current focus is writing on issues in private rented housing.