Originally published as a column for Inside Housing on May 20.
Some very big questions on housing, welfare and tax are looming ahead of this Budget.
If there is not the same sense of raised expectations that surrounds the prospects for land and investment, the answers given by Philip Hammond on November 22 will still go a long way to determining what type of housing system we will have going into the 2020s.
I’ve written many times before about the way that the aftermath of the financial crisis in 2008 and the policies adopted under George Osborne since 2010 have combined to create a system in which older and better-off home owners have gained at the expense of younger and poorer renters.
A piece in the Financial Times last week used figures from the Resolution Foundation to quantify just how much: housing costs for households below average incomes rose by £714 between 2007/08 while they fell by £271 for those on above average incomes. The biggest gains went to the richest 10% of households, whose average housing costs fell by £1,206.
And that these figures do not include substantial increases in housing wealth over the same period as house prices have risen.
So what could Hammond do to redress the balance?
A report today from Generation Rent predicts that the number of pensioner private renters will increase by 169% in England over the next 20 years at a cost of an extra £3.5bn in housing benefit.
The increase will come as a result of trends already hard-baked into the housing system and they have nothing to do with the people in their 20s and 30s that we are used to thinking of as Generation Rent.
Successive editions of the English Housing Survey (EHS) have shown that falls in home ownership are rippling up through the age bands as existing private renters get older and find themselves unable to buy.
The report by David Adler of Oxford University and Dan Wilson-Craw of Generation Rent looks at the current EHS, Office for National Statistics and housing benefit data to forecast what will happen by 2035/36.
There are currently 1.1 million private renter households aged between 45 and 64 who will reach retirement age in the next 20 years. Some of them will still be able to buy but on current trends 947,000 will be private renters into retirement.
Add another 50,000 current retiree households who will live into their 80s and you have a million who could be reliant on insecure short-term tenancies and potentially dependent on housing benefit. That could translate into an extra £3.5bn on top of the current housing benefit bill.