Generation Rent and the

‘Fallacy of Choice’UK Population Change & Housing After the Lifecourse

16-17 June 2015

Dr Kim McKee, Director

Centre for Housing Research

Department of Geography & Sustainable Development

University of St Andrews

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Outline– The Rise of Generation Rent– Fallacy of Choice– Diversity YP’s Experiences

Acknowledgements– Leverhulme Programme Grant: Mind the

(Housing) Wealth Gap (Co-I, Searle PI)– Carnegie Small Grant: Housing Generation

Rent (PI, with Hoolachan)2

THE RISE OF

GENERATION RENT

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Over 40 per cent YP (h/holds headed U35s) now living in PRS; geo variations (Table1)

Phenomena ‘Generation Rent’ – living in PRS longer; priced out of homeownership; ‘jilted generation’ (Howker & Malik 2010)

Reflects protracted & fractured nature of youth transitions to adulthood (Molgat 2007)

Increasing complexity & fragmentation of YP’s housing pathways (McKee and Hoolachan 2015; Cole et al 2015; Clapham et al 2012)

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Table 2: Changing Housing Tenure Structure in Scotland (SOURCE: CASD 2014: 5)

Table 1: Households Headed by U35s in Scotland (CASD 2014)

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Trends mirrored in wider UK adult population; shifting tenure structure since 2007 (Table 2)

Balance in rental sector changing; esp. sig. in Scotland given historically larger SRS

PRS no longer transitional tenure students/ young profs; final destination for many YP

Increasingly diverse sector: housing families with children + low income h/holds due to changes in SRS and impact welfare reform

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  1999 2006 2013

Owner-occupied 61 66 61

Social Housing 32 25 23

Private Rented 5 8 13

Other 2 2 2

Table 2: Tenure change in Scotland, 1999-2013 (CASD 2014)

FALLACY OF CHOICE

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Debates about ‘normalisation’ homeownership well document in HS literature (see, McKee 2011; Flint & Rowlands 2003; Gurney 1999; Ronald 2008; Saunders 1990)

Tenure preferences vary cross-nationally; linked to welfare regimes (Kemeny 1981); key to asset-based welfare (McKee 2012; Lowe et al 2012)

Homeownership strongly attributed to:– Financial security asset ownership– Investment now and for the future– Greater sense autonomy, freedom & control

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YP constructed this normalised ideal as a ‘fallacy of choice’ (McKee’15); not achievable in reality

Expressed frustration at unaffordability housing Felt ‘trapped’ and consigned to PRS for

foreseeable future (quote) Unhappy at cost, quality & security in PRS Not just perceived as a ‘housing problem’; linked

to their vulnerable labour mkt position (quote) Impact of welfare reform on low-income h/holds

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“I just think renting is a waste of money. And it would obviously (be) ideal to get your own house and pay off your mortgage; but I could never do something like that because of my situation. I feel I’m never going to get out of

that and I’ll constantly be renting”

(PRS, 19, Edinburgh)

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“Locally here the economy’s pretty flat and there’s not a lot to cement younger people here, because the jobs aren’t here. So if

there’s no jobs they can’t access the housing; they’re alternatively dependent on housing benefit or low-wage part-time

work and that’s difficult to get the wherewithal to satisfy the mortgage

company” (Housing Expert 10)12

DIVERSITY OF YOUNG PEOPLE’S EXPERIENCES

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Need to problematise idea ‘Generation Rent’; masks diversity YP’s experiences

Significant intra-generational inequalities esp role family-support

Family support displayed many forms– Financial gifts/loans, of large or small sums

– Space in parental home, no/subsidised cost

– Services, including DIY, childcare, transport

– Family bonding, paid holidays, emotional support

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Emotions and complexities to the negotiation of the gift r/ship within family (quote)

Some YP had no support given parents emotional/geographical distance or parental distress (eco marginality/divorce) (quote)

Exacerbated for those in hot housing markets Even where family support is available, may not

be enough in overheated markets (quote)

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“I would imagine it’s a massive burden for my parents. I spoke to my Dad about it quite a few times and he stressed he wished he

could help, but it’s just … and I don’t like him feeling guilty about it … but I think if a parent can help then they will probably, and parents

do take that burden don’t they?”

(PRS, 32, Merthyr)

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“I know for a lot of people it is like their parents can help out, but I don’t think everyone’s

parents can, and I think particularly where parents have been divorced, often financially

they are not in a position to do that … they are not necessarily as financially stable because again they’ve got to start from scratch in the

housing market.”

(Homeowner, 26, Surrey)

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“When I got that money [£50,000] I thought – this is like four years ago – I thought that was such a lot of money. I thought that is

amazing, a £200,000 house now becomes £150,000. But those £200,000 houses are

now one bed, two bed. The market has increased so much”

(PRS, 34, Surrey)

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Conclusions– Despite L/T aspirations to own it was perceived

as a ‘fallacy of choice’; want a home!

– Intersections between housing & labour market vulnerability (+ welfare reform)

– Need to challenge simplicity of ‘generation rent’; evidence of family support & solidarity,

– Diversity YP’s experiences with family support critical (also geography, /hold size, age)

– Homeownership may increasingly become preserve children of homeowners

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Email: km410@st-andrews.ac.uk

Visit the CHR website:

http://ggsrv-cold.st-andrews.ac.uk/chr/

Follow us on Twitter:

@kim_mckee

@StAndrewsCHR

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ReferencesCommunities and Analytical Services Divisions (2014) “Housing Event Themes and Housing and Regeneration Outcomes: supporting evidence”, presentation at Scottish Housing Event, 18th November 2014Clapham, D., Mackie, P., Orford, S., Buckley, K., Thomas, I., Atherton, I. and McAnulty, U., (2012) Housing options and solutions for young people in 2020. York: Joseph Rowntree Foundation.Cole, I; Powell, R; and Sanderson, E. (2015) “Putting the Squeeze on Generation Rent”, paper presented at Deconstructing Generation Rent, University of Sheffield, 13th February 2015.Flint, J. and Rowlands, R. (2003) “Commodification, Normalisation and Intervention: cultural, social and symbolic capital in housing consumption and governance”, Journal of Housing and the Built Environment 18(3): 213-232. Howker, E. and Malik, S. (2010) Jilted Generation. Icon Books.Gurney, C. (1999) “Pride and Prejudice: Discourses of Normalisation in Public and Private Accounts of Home Ownership”, Housing Studies 14 (2), pp 163-183.Kemeny, J. (1981) The Myth of Home ownership: public versus private choices in housing tenure. London: Routledge and Keegan Paul. 21

Lowe, S., Searle, B., and Smith, S.J. (2012) “From Housing Wealth to Mortgage Debt: the emergence of Britain's asset-shaped welfare state”. Social Policy & Society, vol. 11 (1), pp. 1-12. 

McKee, K. and Hoolachan, J. (2015) Housing Generation Rent: what are the challenges for housing policy in Scotland? St Andrews: University of St Andrews: http://ggsrv-cold.st-andrews.ac.uk/CHR/Uploads/Edit/file/Carnegie%20Final%20Report_June2015.pdf

McKee, K. (2015) Briefings 6: Young People, Homeownership and the Fallacy of Choice: http://wealthgap.wp.st-andrews.ac.uk/files/2013/02/No-06-Fallacy-of-Choice1.pdf

McKee, K., (2012) “Young People, Homeownership and Future Welfare”. Housing Studies, vol. 27 (6), pp. 853 – 862.

McKee, K. (2011) “Challenging the Norm? The ‘Ethopolitics’ of Low Cost Homeownership in Scotland”. Urban Studies vol. 48 (16), pp. 3397-3411.

Molgat, M. (2007) “Do Transitions and Social Structures Matter? How Emerging Adults Define Themselves as Adults” Journal of Youth Studies 10 (5), pp. 495-516.

Ronald, R. (2008) The Ideology of Homeownership. Basingstoke: Palgrave Macmillan.

Saunders, P. (1990) A Nation of Homeowners. London: Unwin Hyman. Willets,D. (2011) The Pinch. Atlantic Books. 22