A speech by Sajid Javid on Thursday sought to position the Conservatives as being on the side of young people with the aspiration for home ownership. It is startling how resilient that ambition remains despite the obvious challenge of affordability for those on ordinary incomes.
Javid confronted some of those in the “baby boomers” generation for insensitivity:
Even today, I still hear from those who say that there isn’t a problem with housing in this country.
That we don’t need to build more.
That affordability is only a problem for Millennials that spend too much on nights out and smashed avocados.
The people who tell me this – usually baby boomers who have long-since paid off their own mortgage – they are living in a different world.
They’re not facing up to the reality of modern daily life and have no understanding of the modern market.
The statistics are well-worn but they do bear repeating.
Nationwide, the average house price is now eight times the average income.
The average age of a first-time buyer is now 32.
People in their early 30s are half as likely as their parents were to own their home.
A third of all men in their 30s are still living with their parents – a stat that will send a shiver down the spine of all mums and dads everywhere!
Where once it would have taken an average couple 3 years to save for a deposit – 3 years – it will now take a quarter of a century. Assuming, of course, they can afford to save at all.
And last year, the average first-time buyer in London needed a deposit – a deposit – of more than £90,000.
That’s a lot of avocados.”
Some have characterised these comments as “blaming” the older generation for the housing problem. What about all the pressure on immigration and artificially low interest rates asked Tim Newark in the Daily Express. The Daily Mail yesterday “splashed” on the story and said Javid was accusing the Baby Boomers of being “selfish”.
Of course someone who bought their home several years ago is not to be blamed for finding it has increased in value. The charge of selfishness would only arise if they champion the Nimby cause. However, where the Nimbys do have a point is over proposed ugly developments. This could be overcome by ensuring that new buildings are beautiful, traditional, use local materials and are in sympathy with their surroundings. It is a great pity that Javid does not pay more attention to this solution.
But what is not acceptable is to artificially constrain housing supply to maintain and increase the wealth of those who are already on the housing ladder: As Javid said:
“The generation crying out for help with housing is not over-entitled.
They don’t want the world handed to them on a plate.
They want simple fairness, moral justice, the opportunity to play by the same rules enjoyed by those who came before them.”
It might be regarded as brave for Javid to be taking on the Nimbys – who are regarded as containing many core Conservative voters. However few people would wear the Nimby badge with pride. Not many cackle with pleasure at thwarting the dreams of others. In particular home owners don’t want to die before they their children, let alone grandchildren, get on the property ladder.
The average house price in 1990 was £55,000 (according to the Nationwide Building Society). It is now £210,000. Those who bought in 1990 and who have now paid off their mortgages will be pleased to have accumulated such significant wealth. Would they view any fall in house prices with acquiescence? Surely that is what “moral justice” demands. It is also becoming understood as a politically inescapable. The General Election showed how close we came to a Jeremy Corbyn Government regarding Venezuela as the model for us to follow. Such a warning should concentrate the minds of those hostile to allowing new homes to be built.
Javid is right to be championing this cause with such passion. Last year was difficult for him as he backed Remain in the EU referendum even though many suspected his heart wasn’t really in it – so that pleased nobody. Since then, however, he can focus on a subject which reminds us that Brexit is not the only challenge the Government faces.
Resistance will certainly be encountered – James Forsyth in The Sun this morning reports that even modest changes to Green Belt restrictions have been abandoned. But it was noteworthy that Javid’s remarks were not attacked by Conservative MPs or council leaders – the Daily Mail had to rely on some opportunist criticism from the Lib Dems.
There is growing acceptance among Conservatives that boldness in widening opportunity for home ownership is both a moral and political imperative.