Generation Rent and the ‘Fallacy of Choice’ UK Population Change & Housing After the Lifecourse June 2015 Dr Kim McKee, Director Centre for Housing Research Department of Geography & Sustainable Development University of St Andrews 1

n Outline –The Rise of Generation Rent –Fallacy of Choice –Diversity YP’s Experiences n 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 3

n Over 40 per cent YP (h/holds headed U35s) now living in PRS; geo variations (Table1) n Phenomena ‘Generation Rent’ – living in PRS longer; priced out of homeownership; ‘jilted generation’ (Howker & Malik 2010) n Reflects protracted & fractured nature of youth transitions to adulthood (Molgat 2007) n Increasing complexity & fragmentation of YP’s housing pathways (McKee and Hoolachan 2015; Cole et al 2015; Clapham et al 2012) 4

Table 2: Changing Housing Tenure Structure in Scotland (SOURCE: CASD 2014: 5) Table 1: Households Headed by U35s in Scotland (CASD 2014) 5

n Trends mirrored in wider UK adult population; shifting tenure structure since 2007 (Table 2) n Balance in rental sector changing; esp. sig. in Scotland given historically larger SRS n PRS no longer transitional tenure students/ young profs; final destination for many YP n Increasingly diverse sector: housing families with children + low income h/holds due to changes in SRS and impact welfare reform 6

Owner-occupied Social Housing Private Rented5813 Other222 Table 2: Tenure change in Scotland, (CASD 2014)

FALLACY OF CHOICE 8

n Debates about ‘normalisation’ homeownership well document in HS literature (see, McKee 2011; Flint & Rowlands 2003; Gurney 1999; Ronald 2008; Saunders 1990) n Tenure preferences vary cross-nationally; linked to welfare regimes (Kemeny 1981); key to asset- based welfare (McKee 2012; Lowe et al 2012) n Homeownership strongly attributed to: –Financial security asset ownership –Investment now and for the future –Greater sense autonomy, freedom & control 9

n YP constructed this normalised ideal as a ‘fallacy of choice’ (McKee’15); not achievable in reality n Expressed frustration at unaffordability housing n Felt ‘trapped’ and consigned to PRS for foreseeable future (quote) n Unhappy at cost, quality & security in PRS n Not just perceived as a ‘housing problem’; linked to their vulnerable labour mkt position (quote) n Impact of welfare reform on low-income h/holds 10

“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) 11

n “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 13

n Need to problematise idea ‘Generation Rent’; masks diversity YP’s experiences n Significant intra-generational inequalities esp role family-support n 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 14

n Emotions and complexities to the negotiation of the gift r/ship within family (quote) n Some YP had no support given parents emotional/geographical distance or parental distress (eco marginality/divorce) (quote) n Exacerbated for those in hot housing markets n Even where family support is available, may not be enough in overheated markets (quote) 15

“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) 16

“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) 17

“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) 18

n 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 19

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

n 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 n McKee, K. and Hoolachan, J. (2015) Housing Generation Rent: what are the challenges for housing policy in Scotland? St Andrews: University of St Andrews: andrews.ac.uk/CHR/Uploads/Edit/file/Carnegie%20Final%20Report_June2015.pdf andrews.ac.uk/CHR/Uploads/Edit/file/Carnegie%20Final%20Report_June2015.pdf n McKee, K. (2015) Briefings 6: Young People, Homeownership and the Fallacy of Choice: Choice1.pdfhttp://wealthgap.wp.st-andrews.ac.uk/files/2013/02/No-06-Fallacy-of- Choice1.pdf n McKee, K., (2012) “Young People, Homeownership and Future Welfare”. Housing Studies, vol. 27 (6), pp. 853 – 862. n McKee, K. (2011) “Challenging the Norm? The ‘Ethopolitics’ of Low Cost Homeownership in Scotland”. Urban Studies vol. 48 (16), pp n Molgat, M. (2007) “Do Transitions and Social Structures Matter? How Emerging Adults Define Themselves as Adults” Journal of Youth Studies 10 (5), pp n Ronald, R. (2008) The Ideology of Homeownership. Basingstoke: Palgrave Macmillan. n Saunders, P. (1990) A Nation of Homeowners. London: Unwin Hyman. n Willets,D. (2011) The Pinch. Atlantic Books. 22