The Thinkhouse review of housing research: March

At the age of 27, those born in the late-1980s had a homeownership rate of 25%, compared with 33% for those born five years earlier (in the early 1980s) and 43% for those born ten years earlier (in the late 1970s).

The work found that the fall in homeownership is entirely explained because young adults’ incomes are now much lower relative to average house prices.

Why did I mention this first? I am certainly not a believer that home ownership is the only option for a stable, healthy life; after all, I work in social housing.

But I am also a child of the 80s (although the early 80s) and the analysis gives more meaning and depth to my own lived experience.

What I see is my friends overloaded with high-monthly mortgage costs, with terms outlasting their likely employment age, for homes they are growing out of quickly.

Or they are still in house shares, or other unstable private rented sector options. The report also looks at the difference in the homeownership rates of young adults from different socio-economic backgrounds, and it finds that young adults from more advantaged backgrounds are significantly more likely to own their own home.

Between 2014 and 2017, 30% of 25 to 34-year-olds whose parents were in low-skilled occupations owned their own home, compared with 43% of those whose parents were in higher-skilled occupations (for example, lawyers or teachers). This suggests we need good-quality housing provision for those in that lower socio-economic band who cannot afford to buy a home. It also moves us neatly on to look at the three reports out this month on social housing.

With many explorations on the future of social housing, we are likely to see more interesting pieces of work looking at social housing through different prisms. This month we have the JRF’s excellent and succinct briefing note, which covers the inequalities of the housing market and provides a high-level cost-benefit analysis to argue that investment in social housing is a way to right this imbalance. It also argues this should feature as part of the government’s Social Housing Green Paper due to be published in the spring.

Sitting alongside this is an exploration by the London School of Economics of ‘Overcoming the Stigma of Social Housing’. This is much more than its title suggests. It provides a detailed analysis of the changes in tenure and housing management during the past few decades and how this has impacted on social housing tenants.

Aimed at providers and government, it uses census figures and the latest English Housing Survey data to provide a picture of the general composition of social housing, who lives in it, and their social and economic backgrounds. It also examines the trend towards greater residualisation over time.

This month’s third publication focussed on social housing is Setting Social Rent by Capital Economics. This research paper provides a detailed but accessible analysis of different social rent policies. It takes into account impacts on the government’s fiscal position, social landlords’ operating margins, landlords’ ability to invest in new housing and tenants’ ability to afford the rent levels evaluated.

“The Capital Economics research paper provides a detailed but accessible analysis of different social rent policies”

Its appendices also feature a useful analysis by region. Its main finding is that the 1% rent cut was unsustainable.

The government’s proposed policy of consumer price inflation plus 1% after 2020 is broadly appropriate in much of the country, but differences in regional housing markets mean a single national policy cannot achieve an optimal impact on different stakeholders (government, social landlords and tenants) everywhere.

It also finds that the sustainability of real increases in social rents is dependent on corresponding increases in the overall benefits cap. It argues a long-term settlement on rent is needed and it makes some recommendations about these features.

For me, this last report ticks all the boxes. It gives providers information to nuance their rent setting, gives governments knowledge on what the trade-off is for social rent setting and stimulates debates on how we set social housing rents in the future.

I have focussed on the reports I found most interesting, but there were also several other quality pieces of research produced this month.

They included pieces on Housing First, planning loopholes and policy settings, and institutions relevant to the Australian private rental sector.

Gemma Duggan, senior consultant at Altair and editorial panel member at Thinkhouse