Millennials spend three times more of income

on housing than grandparents

https://www.theguardian.com/society/2017/sep/20/millennials-spend-three-times-more-of-income-on-
housing-than-grandparents
David Willetts warns of ‘housing catastrophe’ as he launches study that lays bare
intergenerational inequality

Millennials spend three times more of their income on housing than their grandparents,
but are more likely to live in overcrowded spaces and face longer commutes. Photograph:
Joe Giddens/PA

Robert Booth
Wednesday 20 September 2017 00.01 BST

Millennials are spending three times more of their income on housing than their
grandparents yet are often living in worse accommodation, says a study launched
by former Conservative minister David Willetts that warns of a “housing
catastrophe”.

The generation currently aged 18-36 are typically spending over a third of their
post-tax income on rent or about 12% on mortgages, compared with 5%-10% of
income spent by their grandparents in the 1960s and 1970s. Despite spending
more, young people today are more likely to live in overcrowded and smaller
spaces, and face longer journeys to work – commuting for the equivalent of three
days a year more than their parents.
The research by Willetts’ intergenerational commission at the Resolution
Foundation thinktank also reveals that today’s 30-year-olds are only half as likely
to own their own home as their baby boomer parents. They are four times as likely
to rent privately than two generations ago, a sector which has the worst record for
housing quality, the report claims.

The report’s authors argue that the housing crisis is a huge part of public anxiety
about the country’s direction, a factor in the result of the EU referendum last year
and in the general election in June.

A young family today has to save for 19 years on average to afford a typical deposit
compared with three years for the previous generation, the report states.

“This is the biggest problem facing the younger generation,” said Willetts. “It
depresses their living standards and quality of life. It is very important for the Tory
party to open up the route to home ownership again. A lot of twentysomethings
also have horror stories of bad landlords and we need to help them as well.”

By highlighting intergenerational inequality, Willetts hopes to break down public

opposition to mass housebuilding – not least from parents who despair at the
difficulty their children face in finding good housing. He is arguing for a new towns
programme in which the government buys land that does not have planning
consent to create large new communities of homes for sale.

The report came as the communities secretary, Sajid Javid, also announced a
wholesale review of social housing policy in the wake of the fatal fire at Grenfell
Tower, a 24-storey block in north Kensington which combined council housing and
a small number of private rented homes.

Speaking to the National Housing Federation conference in Birmingham, Javid

said: “In one of the richest, most privileged corners of the UK – the world, even –
would a fire like this have happened in a privately owned block of luxury flats? If
you believe that the answer is no, even if you think it was simply less likely, then
it’s clear that we need a fundamental rethink of social housing in this country.”

He said a social housing green paper would propose reforms to the overall quality
of social homes, the rights of tenants and will address what can be done to ensure
their complaints are taken seriously and dealt with properly.
Grenfell residents claim they raised concerns about fire safety at the block on
several occasions but were not heeded. The Resolution Foundation report found
that almost a third of 25-to-34-year-olds living in private rented flats live in
properties which fail the decent homes standard.

Responding to the Resolution Foundation report, Dan Wilson Craw, director of

campaign group Generation Rent, said: “Young adults have been hit with a double
whammy of rising house prices which make ownership unaffordable, and rising
rents which they cannot escape. The chorus of demands on the government to act
decisively is getting louder, but it’s important not to neglect the growing numbers
of older renters. Because getting a mortgage becomes harder beyond the age of 40,
many face a lifetime of renting.

“Millions of people, young and old, are stuck renting for the foreseeable future and
they need much greater security than the market currently provides, with
protection from eviction and rising rents.”