28 September 2018

The Tories face eviction from office unless they help Generation Rent


Brits have long been a nation of homeowners and aspiring homeowners. Just why we have this culture of home ownership isn’t easy to answer. But, for politicians and policymakers, the reasons are less important than the consequences. Polling commissioned by the Centre for Policy Studies found that only three per cent of young voters never wanted to own their own home.

If the desire to own a home remains as strong as ever, actually doing so has become dramatically harder for younger adults in recent years. Research from the IFS has shown that from the mid-1990s to the middle of this decade, home ownership among 25-34 year olds on middle quintile earnings plummeted from 65 per cent to 27 per cent. Against that backdrop, a lot of the problems that the Conservatives have been experiencing start to make sense.

It’s already been shown that the “youthquake” that was supposed to have powered last year’s unexpectedly strong election performance by Labour, was a mirage. The youthquake was in fact a rentquake, with turnout surging by eight points among renters (and 10 points among those renting in the private sector), compared with almost no change among homeowners. The fact that renters tend to be younger than homeowners only accounts for a small part of this – the differential exists within age groups (and also within both Remainers and Leavers).

What’s more, Labour’s huge gains among renters weren’t confined to new voters – they also achieved substantial gains among those who voted in both 2015 and 2017. Taking both new and existing voters into account, the data from the British Election Study shows a swing from the Conservatives to Labour among private renters of 10 per cent – a 1997-sized switch. Renters collectively accounted for the entirety of the 2 per cent swing to Labour that cost the Conservatives their majority.

As Robert Colvile has argued, it could end up costing the Tories power altogether. Worse still from their point of view is that even with the surge in renter turnout, still only about half of renters made it to the polls. In other words there are a lot more disgruntled voters out there.

More broadly, housing is moving up the political agenda. The Ipsos MORI Issues Index recently recorded its highest percentage of people citing housing as an important issue since 1974, and its second highest ever. And polling in the crucial battleground seats, focused specifically on housing, provides even more cause for concern for the governing party.

Earlier this month, Number Cruncher polled 1,247 adults in 60 English marginals for housing charity Shelter. On a similar question to the MORI tracker, 21 per cent named housing as an important issue, rising to 29 per cent among private renters. Labour’s 14-point lead on housing almost doubles among renters. And among private renters, housing is the number three issue, behind Brexit and the NHS.

Across housing tenures, about two-thirds of adults in the marginals think that things have got worse when it comes to housing over the last five years – more than on any other issue – with only one in 20 saying it has got better over that period. A slightly higher proportion agree with the statement “there is a housing crisis in Britain”, including three-quarters of renters.

It’s worth remembering that rising housing costs aren’t just a problem for renters in terms of making the prospect of home ownership that bit more distant. If rents rise, that’s also an immediate hit in the pocket. Furthermore, young professionals being off the housing ladder for longer and longer means that the other problems facing renters – both the poor quality of rented accommodation and the limited statutory protections compared to those in other countries – become a bigger headache for them.

All of this has put younger professionals of the sort the Conservatives used to attract easily now very much in play. The party of homeowners is finding that there aren’t enough of them to get it across the line without broader support.

Perhaps the most interesting finding, and the most encouraging for anyone wanting to see the shortage of housing addressed, is that older homeowners – often portrayed as selfish NIMBYs – don’t seem to fit that stereotype. Seventy-seven per cent of all adults in the marginals agreed that “it will be harder for the children of today to buy or rent a home than it is for me”, rising to 81 per cent among outright homeowners and 87 per cent among over-65s. That might be a sign that children and grandchildren struggling to pay the rent or save for a deposit are having an effect.

NIMBYism has long been blamed for constraining supply, but is no longer the insurmountable obstacle it once was, and is therefore harder to use to justify inaction. But what action should be taken? Increasing the supply of social housing is popular with the public – in fact the most popular of the options offered. But so is Help to Buy, a policy crafted to help the Conservatives win the 2015 election (and which in retrospect may have had a bigger hand in them doing so than was first thought) but which does nothing to address the lack of supply.

The Tories need to think carefully and think big on housing, or they will only have themselves to blame if renters find a new tenant for Number 10.

Matt Singh is the founder of Number Cruncher Analytics.