Leading article: Still far from being a nation of renters

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The Independent Online

Like it or not – and a great many people do not like it – the British could be on the way to becoming a nation of renters. The tide of home-ownership is turning, according to a spate of surveys, as high prices and a continuing mortgage famine combine to force would-be buyers to postpone their ambitions and remain in the rented sector, much like their contemporaries across the Channel.

This does not mean, however, that the British are reconciled to the new reality. The head (and the banks) may dictate against buying, but the heart still hankers after owning. The Englishman's castle has not lost its lure. More than three quarters of under-45s in one of the surveys we report today want to own their own home, even as two thirds believe their prospects of so doing are nil.

This throws up two elements that the Government and the lenders need to address. The first is the risk of a disaffected generation, deprived of the opportunities for domestic and financial stability that their parents and grandparents enjoyed. Another report – from a centrist think-tank – recommends that banks should revert to the lending policies of a generation ago: an end to 100 per cent mortgages and loans advanced strictly in proportion to verified income. With prices so much higher than they were then, and many incomes static or worse, such terms would exclude more people from home-ownership. But if bubbles are to be avoided, this could be the responsible way to go.

If that is so, then the last two decades have to be treated as an anomaly. And if they are, a new emphasis needs to be placed on renting. Despite the popularity of "buy to let" arrangements – among buyers – renting still offers a relatively precarious existence for tenants and the quality of much accommodation, especially for families, leaves much to be desired. Renting succeeds on the Continent because tenants enjoy decent security of tenure, the quality gap between owned and rented accommodation is narrower to non-existent, and there is a far wider choice of housing on offer. All of which shows, if Britain is to have a larger class of renters, just how much remains to be done.