In 1604, the English judge Sir Edward Coke declared that “the house of everyone is to him as his Castle and Fortress.” The intervening years turned the saying to “and Englishman’s home is his castle.” With apologies to the Scots, Irish and Welsh, it is perhaps not surprising that the widespread aspiration for home ownership is ingrained in our national psyche.
But Britain is not quite the nation of homeowners we believe ourselves to be. Rather than having the highest levels of owner occupation among developed nations, the UK is nearer the bottom of the league than the top. Growing levels of renting since the early noughties have depressed the proportion of mortgaged homeowners so that rates of owner occupation are now lower than they were 25 years ago and lower in comparison with Europe, North America and Australasian countries as well as the economic giants of India and China.
Understanding the reason for this decline is important to fully understand the resulting economic and social impacts and to enable appropriate responses and policy to be made. The issue of housing imbalances in the United Kingdom is persistent and concerning. The problem has been exacerbated by decades of market dynamics and policy decisions. Land ownership, which is seen to have traditionally favoured landlords over tenants, is under threat. In recent years, in the face of disparities in wealth distribution. There has been a growing call for a transfer of housing wealth back from landlords to tenants. But this has its own risks which are beginning to be seen where draconian anti-landlord regulation discourages investment, reduces supply and has an inflationary effect on rents.
A more sophisticated approach is needed, suited to the 21st century, which breaks the age-old adversarial landlord-tenant relationship and more closely aligns the interests of both parties. If this is not achieved, the housing market risks becoming a permanent instrument and mechanism for perpetuating social divisions. The iniquities created by current mechanisms need to be addressed both imaginatively and accurately.
The UK Labour Party, has stated in draft policy that its aim is to increase home ownership in the UK to 70%. On the face of it, this should not be a difficult task to achieve; the UK reached this level of owner-occupation back in the early noughties. Owner-occupation rates were over 70% between 1999 and 2007. They fell after the global finance crisis in 2008 and have only recovered marginally since their nadir of 63% in 2017.
