Being born before or after 1979 is apparently key to whether you're able to afford to own your own home or not. Older than 33 and you're likely to be already on the ladder, having bought a few years ago and seen values rise in the main. Younger than 33 and it's a massive struggle to put enough of a deposit together and to earn enough to secure a sufficiently large mortgage to get on the ladder. I'm north of 33 and the other day I looked at the price of my first flat, which is currently on the market, and realised that if I only had say a 10 per cent deposit then I probably wouldn't get a mortgage high enough to buy it. This was no palace. It was a more akin to a shoebox backing onto a railway track, typical of so many first-time buyer properties in London.
As the Independent on Sunday special report on first-time buyers highlighted last week we have entered into a time of property have and have-nots. People with good jobs on comfortably-above-average salaries have no chance of buying. The properties that are available are often snapped up by buy-to-let landlords who, invariably born before 1979, have benefited from rising prices and have sufficient equity to borrow against.
This shift away from home ownership is happening as fast as the Thatcherite shift towards it in the 1980s. In fact, it's been predicted that by 2020 fewer than half the homes in the capital will be owner occupied and nationwide the figure will rest at around 60 per cent down from 70 per cent a few years ago.
Some say it's no bad thing if we move away from property ownership, become more continental and rent. After all, property bubbles have been at the root of our two last recessions. But what kind of experience are the millions forced to rent going to endure? A pretty miserable one, if you look at the activities of some landlords.
Put simply, since 1979 – that date again – tenants have been at a major disadvantage. There is no rent control and tenants can be turfed out at short notice. Research this week showed the number of tenants being treated in this way is up 17 per cent since 2007.
Now, as we are facing a situation where millions in their teens, twenties and thirties will spend their lives in rented accommodation, rather than it being a temporary solution prior to property ownership, we need more rights in place.
The numbers bringing up children and grandchildren in rental accommodation is going to soar. To think of landlords being able, with just a few weeks notice, to kick out families whose children are settled in local schools, is alarming.
Personally I'd like to see rent controls in place like in Germany, where local government can set a cap on rent rises, normally around inflation and where, after six months, tenants have the right to remain for as long as they like, provided they pay rent on time and keep the property in good order. But that's not going to happen as it smacks too much of being anti-free market.
However, what we can hope for is reform to the shorthold tenancy regime with tenants and landlords agreeing longer deals, say five years at a time, with a pre-agreed formula for rent increases, say inflation again.
There is, though, a great big roadblock to any reform in this area, as well as the rights of leaseholders to tackle their managing agents covered on pages 98-99, and that is the ultra-dry Tory housing minister Grant Shapps. This disciple of 1979, the year of Thatcher, won't countenance interfering in the free market but, mark my words, something will have to be done about this soon.Reuse content