Originally published April 2022.
Long-held assumptions about rising house prices are being shattered by the affordability crisis.
When Nigel Lawson described the NHS as “the closest thing the English people have to a religion”, his party was in the process of substituting it with another: the housing market. Policy changes such as tax incentives, the right to buy and the deregulation of the private rental market had formed the basis of Thatcher’s goal for a “property-owning democracy” and for decades the narrative has held that rising house prices translate into general wealth.
Polling released yesterday (31 March) indicates that the British public no longer believe this story. Confronted by low levels of home ownership and an affordability crisis, the British public would now prefer house-price growth to remain low or to stop entirely, and homeowners are in favour of bold reforms to make housing more affordable at the expense of their own properties increasing in price.
The polling, carried out by YouGov on behalf of the research and campaign group Positive Money, found that more than half (54%) of British homeowners would be happy if their own home did not rise in value in the next 10 years, if that meant houses were more affordable for those who don’t own property. Since 2000, average wages have grown by 94% while house prices have grown by 224%.
“I think people realise that the system is broken when you can’t really own a home just from having a job,” said Danisha Kazi, senior economist at Positive Money. “Soaring house prices are locking the younger generation out of home ownership. Most people who own homes are older, they’ve got children or grandchildren and they recognise there isn’t an easy way to get them on the ladder other than for them to give them equity that they have in their own housing.
“At the same time, many homeowners are also banking on their own house paying for their retirement or care — the costs of which are also rising — and many are not wealthy enough to pass housing wealth on to their children.”
