Owner Occupation for All Who Want It

There is a housing crisis in the UK,which has various components.

 There is clearly a need to provide adequate temporary accommodation to all those who need it. At present local authorities only have a duty to accommodate those considered to be in ‘priority need’, which usually means they have dependent children, are fleeing violence or who have significant disabilities or health problem. As if being homeless wasn’t priority enough ! 

 Beyond the agreed need to provide adequate ‘ emergency’ accommodation there is a need to substantially increase the supply of ‘ social housing’, provided by local councils and housing associations, and offering relatively secure tenancies at reasonable rents. The significant decline in the quantity of social housing since Thatcher’s Right to Buy legislation in the 1980’s has meant that more and more people, including families with young children, have to rent from private landlords, with no security of tenure and little protection from poor standards of repair and rising rents. The abolition of ‘ no fault evictions’, which even this dreadful government has committed to, is a much needed reform which a progressive government would legislate for as a matter of priority. 

 My own view is that we should go further and recognise that most people would like to become owner occupiers. Many are prevented from doing so not because they can’t afford a monthly mortgage payment ( the latest figures confirm that the average monthly mortgage payment is lower than the average private monthly rent ) but because they cannot find the 5-10 % deposit required to obtain a mortgage and/or are not considered to be financially secure enough by the institutions lending them the money. A progressive and active government should get involved, underwriting such mortgages and only requiring buyers to provide a minimum deposit, similar to the amount required as a deposit for a private tenancy. Buyers should also be able to borrow as much as they can reasonably afford and be given the option of an interest only mortgage, based on the assumption that they need never become ‘ mortgage free’ but merely be able to afford to make their monthly payments. They should also have access to financial help to pay their interest if they qualify for means tested benefits, on the same basis as tenants. If financial institutions aren’t prepared to play ball then the state, at either national or local level, should be willing to lend the money itself. 

 The above reforms would open up the housing market to millions of aspirant owner occupiers, most of whom have reasonable incomes. Those unable to depend on the ‘ bank of mum and dad’ and not expecting a large inheritance any time soon, will otherwise find their housing ambitions frustrated for many years to come. The growth of interest only mortgages would also, in the longer term, lead to many more owner occupiers choosing to downsize as they get older, out of economic necessity, in order to reduce their monthly payments as their income reduces upon retirement. Many would probably never pay off their mortgages, with the property returning to the lender rather than being passed on to their children/relatives as an inheritance. Given that inherited wealth is one of the biggest drivers of inequality would this be such a bad thing ? 

 State involvement in the regulation/ provision of mortgages and in the housing market as a whole, could also contribute to addressing the climate emergency, the biggest challenge of all. The evidence suggests that there is already enough ‘ housing’ in the country, in terms of living and sleeping space. It is just very unevenly distributed (1)and (2)There shouldn’t be a need for a mass house building programme, which remains a carbon intensive activity, but rather a programme of retrofitting and adaption. Retrofitting requirements could be made a loan condition where practical/ appropriate, whilst owner occupiers could be financially supported to adapt/convert properties which have become larger than they need ( as children move away etc) perhaps with additional stairways/ external doors being fitted so that ( for instance) a four bedroom house becomes a 2/3 bedroom house and a 1/2 bedroom flat, with one of the two new units made available for sale.

 All of the above seems to me to be eminently possible, with the right creativity and commitment.

 (1) Danny Dorling has written extensively and cogently about housing in the UK. His analysis of the 2011 census data concludes that “there are enough houses in the UK, and that there are more bedrooms in these houses than ever before. Even in London, there are more bedrooms in houses and flats than there are people to sleep in them. There are, for the first time, enough bedrooms for everyone to have their own, if they want it. “ here For Dorling the problem is that some people have far too much space and others not enough . By 2011 the richest 10% of the population of England and Wales had 5 times as many rooms in their house per person as the poorest 10%.

 (2)The recently published 2021 census didn’t publish data in the same way but did reveal the following information: - Over I million homes are unoccupied ( 5% of the total) - Half a million people own a holiday home - Whilst over 1 million households were ‘ overcrowded’, lacking the number of bedrooms they required, over 17 million households ( 70%) had more bedrooms than they ‘ needed’. here