Social housing for the younger generations?

Published on Housing, Wealth and Debt, Intergenerational Commission

Social housing has received much well-deserved attention over the conference season and even looks set to be the star of the show in Theresa May’s speech. But while the rise and fall of the sector is a familiar story, the intergenerational consequences of its course are rarely remarked upon. With our new research showing that so many of today’s young people are adrift when it comes to housing, it’s worth thinking about how their parents and grandparents benefited from the post-war social housing project – and whether a similar offer is really going to be made today.

In 1981 – the sector’s highpoint – three out of every ten families rented their home from the council or a housing association; today, that figure has halved. And there’s a very simple explanation as to why this is the case: as Figure 1 shows, years of low build rates and Right to Buy sales mean there’s simply less social housing stock to go round.

Figure 1: Net additions to social housing stock over time: England

Source: RF analysis of DCLG live tables data on housing completions (Table 209) and Right to Buy sales (Table 678)

Combine this with the fact that those offered social tenancies are often reluctant to give up this prize and it’s easy to see how the number of social rent properties available to young people has fallen over time. In Figure 2, the intergenerational effect of this is plain to see. Look first at the experience of those born before the war and we see how families from these generations benefited from the expansion of the sector in its prime. Compare, then, the rates at which younger generations have occupied this most affordable of tenures and the impact of the sector’s decline is evident. Add in the fact that social renting rates for older generations fell after 1980 and we can see that for them social housing was a gift twice over: first, in providing a secure and affordable home and second, in giving them the chance to purchase their property after the Housing Act 1980 introduced Right to Buy.

Figure 2: Proportion of families living in the social rented sector over time: UK

Source: RF analysis of Family Expenditure Survey 1961-1983; Labour Force Survey 1984-2017

Not only have older generations been able to access social housing in greater numbers than their younger counterparts but their qualitative experience of the sector has arguably been better as well. In the early years of the sector’s development social builds were often at the cutting edge of quality and design. With standards slipping from the 1970s onwards, and many of the more pleasant properites sold off under Right to Buy, social housing is too often a watchword for poor quality (or worse) today.

Furthermore, the lifetime tenancies which turned a rented house into a home for older generations are increasingly a thing of the past. While local authorities and housing associations have been able to make rent properties on a less secure footing for some time, the Housing and Planning Act 2016 requires social landlords to offer only fixed term tenancies from hereon in except in the most exceptional of circumstances. While this may make sense given the high demand for this scarce resource, it clearly leaves future social renters with less security than historically enjoyed.

Whether we look at its more widespread availability, its better quality or its greater security of tenure, it is hard not to conclude that the older generations have been truly advantaged when it came to social housing. Could younger people be offered a similar deal? We wait to see the details from Theresa May today but when Sajid Javid announced a new Green Paper on social housing recently he signalled some big ambitions: to build more social rented properties; to improve the quality and safety of social housing stock; and to “return to the time, not so very long ago, when social housing was valued”.

A renewed social housing sector would clearly be an intergenerational win. But as always the devil is in the details. How will government bolster the capacity of local authority housing and planning departments? What kind of strategic steer will it give to councils on the exercise of compulsory purchase powers? And how can housing associations best be brought into the fray? But if the PM and Secretary of State truly follow through on their warm words, perhaps the manifold benefits our parents and grandparents had as social renters will once again be enjoyed by young people today.