No dinner party would be complete without talk of property values, gazumping, or someone who has made a killing, or a loss, on their home. We are obsessed with our bricks and mortar. More of us own our own home than any other European country – although this is decreasing as values have risen to unattainable levels for many.
On this crowded and class-conscious island, home ownership has always been associated with status and self-worth. Indeed, up until the late nineteenth century only property owners were allowed to vote. More recently, mortgages for the masses have further fuelled the thirst for ownership.
In less than a generation, the proportion of adults living in their own home has leapt from a third to more than two-thirds. The pressures to buy are huge, but first time buyers are struggling to get a foot on the ladder unless the bank of Mum and Dad steps in. Mortgages for young people can be difficult to acquire and many parents, whose property wealth has grown dramatically over the past 30 years, are now moving to something smaller, thereby releasing equity for their fortunate off- spring.
So what will happen if house prices continue to rise and borrowing becomes increasingly more difficult? Well this is a problem the government is clearly concerned about, hence why we have seen so many changes to the property industry, mainly aimed at trying to free up stock by attacking “those greedy landlords who are holding onto all the properties”. In reality, we all know that a growing population requires more houses, not simply a shift in the homeowner/tenant ratio. If every tenant was to buy the property they are currently renting, would it mean we can stop building new houses?
In light of recent events, I am left wondering just how much time and focus will be afforded to the housing shortage situation. Will the minds of our MP’s become transfixed on Article 50? Yes of course this is important, it’s important to everybody; however, there are other matters to tackle, and we could do without further legislation simply rushed through in the hope it might solve a problem. As you have read in our monthly report, a reduction in buy to let purchases may slow things down a little, so let’s just see how that pans out first.