'Generation Rent': You shoulder the real risk of politicians' inaction on London housing

 
Don Levett2 May 2012

So it's a pretty firm bet that a lot of us will never be able to afford our own homes in London. 'Generation Rent' - those who don't qualify for social housing but can't afford to buy - is in an even more vulnerable position than they realise.

And whilst much is made of the risks of home ownership (house price and interest rate fluctuations, as well as the consequences of default), little is said about the risks of not owning your own home.

As the private rental market heats up, this risk is becoming clearer. Whereas home owners have a reasonable level of predictability over their own accommodation costs (short of another Black Wednesday), Generation Rent does not. And with a lack of rental supply coupled with London's projected population increases over the next 20 years, the painfully obvious implication is that rents will continue to rise, and rise and rise.

Not only does this contribute to their decreasing ability to get on the ladder (with rents rising, less money can be saved for deposits), it also means they're trapped into a choice between either leaving the capital or devoting ever increasing proportions of their income to their accommodation costs. Beyond a certain point, even that will cease to be a choice. This is a recipe for serious social problems, and runs the risk of a generation that will question the fairness of the welfare system and will further inflame disquiet at perceived levels of inequality.

Forget changes in tube fares and council tax; if action isn't stepped up to tackle London's housing crisis then these issues will pale in comparison to rental rises over the next decade. Think carefully in tomorrow's elections, because if the politicians fail to act, you will be the ones paying for the consequences.

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