They call it “hutching up”, but the trend is nowhere near as cosy as the name makes it sound. Say you’re in your 20s or early 30s, living in London or some other property hotspot. You’re dating someone who isn’t Mr or Ms Right, exactly; but they’re not that bad. And together, if you pooled your resources, you could maybe afford to get on the property ladder – whereas if you broke up, then you might not make it.
Fifty years ago women struggled to buy property on their own because banks required a husband to guarantee the mortgage. Now it’s not sexism, but the seeming economic impossibility of buying on just one salary, that makes young women think twice about being single.
Enter a knight, then, in suspiciously shiny armour. Save up to £12,000 towards a house in one of George Osborne’s new help-to-buy Isas, launched in this week’s budget, and he will add £3,000 gratis (or £6,000 if two of you save). Free money! Who doesn’t want that? If I were 28 again, gloomily contemplating an eternity of creepy landlords who never fix the boiler, I’d probably grab that lifeline with both hands. But let’s be honest about who else this is a lifeline for: about who benefits from reheating a property market that had looked as if it were starting to cool a little faster than had been expected.
This stuff is made for marginal Midlands seats, where people who have themselves lived rooted, solidly middle-class lives worry about their grown-up kids raising families in cramped flats, or sofa-surfing precariously around a capital where they can’t even afford to rent. (What the “let them eat rent” brigade forget, when they say Generation Y should just accept that home ownership isn’t a realistic aspiration, is the forecasts suggesting rents too could rise twice as fast as incomes over the next 25 years.) How many career choices will close for small-town kids with big ambitions if they can’t afford to move where the jobs are?
Well, now the chancellor has given Tory candidates something cheering to say about all this on the doorstep – at least to buyers not in the kind of insecure, casualised work that banks dislike lending against – which can’t harm his chances of remaining securely housed in Downing Street. But he isn’t the only beneficiary.
Rather like pyramid-selling scams, housing markets need a constant stream of fresh-faced hopefuls coming in at the bottom in order to keep delivering big returns at the top. No new buyers equals no more sellers’ market, equals no pressing reason all of a sudden to pay half a million for a four-bedroom modern box in Worcester or a one-bedroom flat in much of London – and what then?
No more baby-boomer pensions made of bricks and mortar; no more house that earns more than you do, no piggybank of equity to raid in a crisis. The chancellor isn’t just hauling more people aboard this financial lifeboat, but thinking about the millions already in it.
Suddenly you see why, for this government, subsidising the rents of the poor via housing benefit is deemed to be wasteful and wrong – but subsidising roofs over middle earners’ heads (to the tune of nearly a billion a year through the new Isas by 2020, plus £3.7bn on cheap house loans under the existing help-to-buy scheme), weirdly enough, is not.
But what if all we’re really doing – by accepting crazed property prices as the norm, to be alleviated only by the fiscal equivalent of chucking tenners into a crowd – is sucking first-time buyers into a sort of national Ponzi scheme? What if we’re luring them in at what would otherwise have been the peak, just to keep the boom rolling a little bit longer, and leaving them horribly exposed to negative equity if another crash comes?
Those who argue that governments should be building more houses, rather than fuelling demand for something in limited supply and watching prices rise accordingly, are half right. We do need to build more; if Ukip weren’t wooing votes in the Tory shires by promising to save villages from bulldozers, the chancellor would probably agree. But if only that were all we had to do.
Housing is simplistically portrayed as a battle between ageing rural nimbys who don’t want their lovely views ruined, and their children’s priced-out generation. (I declare an interest, living in rural Oxfordshire; but the biggest deficiency nationwide is actually in London, where it was recently estimated that 14,400 fewer homes than are needed are being built per year).
The stereotype is, nonetheless, half true – although it glosses over those rural objections that aren’t easily dismissed. Developers can knock up an estate on the outskirts of a village within weeks now, but the extra school places or transport links that those new inhabitants need will often lag years behind, if they come at all.
However, a decades-long failure to build isn’t the sole reason prices in London or Cambridge or Brighton or Chelmsford have gone stratospheric. The market has also been skewed by speculative foreign money, a long tail of City bonuses, an explosion of buy-to-let landlords competing with first-timers, and the fact that the best opportunities for work or play are still intensely concentrated in certain cities, where people inevitably compete to live. You could concrete over the Cotswolds tomorrow and barely touch these problems.
But what politician has the nerve to tell millions of homeowners that it isn’t just rural voters who ought to take one for the team; that the price of the biggest asset you will ever own ideally needs to fall; or that your nifty buy-to-let sideline deprives others of even one home to call their own?
Who is confident, indeed, of charting a new path to national prosperity that doesn’t rely on a consumer boom sustained by property wealth?
Seemingly not the chancellor, with his pension reforms expected to unleash a whole new wave of “granlords” – or newly retired people pouring their lump sums into property. And seemingly not those millions of voters best suited, if we’re honest, to carrying on roughly as we are: to kicking the can a bit further down the road again, and trying hard not to think about where it will eventually roll to a halt.
