Before the abysmal results for her party were confirmed in last week’s European Parliament elections, Theresa May stood on the steps of Downing Street to tender her resignation. As she did so, she listed her proudest achievements, including her work on housing.
Many have disputed May’s self-proclaimed accomplishments, but when she declared in October 2018 that “solving the housing crisis is the biggest domestic policy challenge of our generation”, she meant it.
May was advised by former housing minister Gavin Barwell and several former Shelter policy advisors. Policies for renters were introduced under her administration, namely the Tenant Fees Act and a promise to end Section 21 evictions. While George Osborne and David Cameron saw social housing as politically toxic, May dropped the cap on councils borrowing to build homes and started talking about the importance of social housing again.
The Prime Minister knew housing had reshaped Britain’s political landscape. But, less than a year later, her grand ambitions have been scuppered by what is now Britain’s number one policy: Brexit.
It is now generally accepted Brexit was brought about by opposition to immigration because of a faceless demographic known as the ‘Left Behind’ (or ‘Just About Managing’, as May put it) who are regularly discussed in broad brushstrokes by politicians.
But what has been largely overlooked by politicians and the media is the specific role the cost of housing played in the result. Osborne and Cameron largely ignored the housing affordability crisis at their peril, with the exception of Help to Buy, which has helped just 420,000 people at a time when one in three young people will never own a home.
After the EU referendum, Ben Ansell, Professor of Comparative Democratic Institutions as Oxford University’s Nuffield College, drew on local economic and housing data in order to assess how housing in Britain affects politics, specifically Brexit. He looked at regional variations in local housing markets and how people in those areas voted in the referendum, delivering his findings at the University of Wisconsin in April 2017. His research has to be some of the most granular data on the political geography of the housing market available.
Homeowners and house prices
Ansell found in all cases, “local authorities and wards with higher house prices, and homeowners living in those areas, were more supportive of staying in the EU”.
On the flip side, Ansell found people living in an area which has experienced low and stagnating house prices for decades were more likely to support Leave. We know homeowners voted to Leave too, but the focus is always so heavily on London many forget not all voters bought in an area where it’s proved more lucrative to own property than be in work in recent years.
‘If you control for house prices in the North East and Yorkshire, you’ll find a higher baseline support for Remain in those areas than you might expect’
According to Ansell, the Leave-voting, post-industrial North East, Wales and West Midlands along with (non-tourist) Cornwall and North Yorkshire are key areas where house prices have broadly been “low by national standards for generations”. But he notes that if you control for house prices in the North East and Yorkshire, you’ll find a higher baseline support for Remain in those areas than you might expect.
In London, meanwhile, his analysis showed in a borough like Hounslow, which narrowly voted to remain by 56,321 votes to 58,755 votes, it was the wealthier wards like Chiswick where house prices are higher which drove the Remain vote.
The level of house prices, their change over time and the effects of this on people’s lives at a local level mattered in the vote. Homeowners who have benefitted from the boom of the last few decades, like those who can afford to rent in affluent areas, understandably feel differently about the world to those who haven’t and can’t.
Inevitably, this is also linked to how people feel about immigration. If you’re a homeowner who has watched your house rise steadily in value over the last 15 years, making you an almost-millionaire on paper, then you’re not going to feel as resentful of the EU and the freedom of movement that comes with being a member of it as a buyer who bought in an area that has stagnated, are you?
“Leave’s success,” Ansell says, “was based among the relative losers of the British housing market” across the country.
In the last 20 years, the UK has experienced an unprecedented boom in house prices and a decrease in affordability, with the boom skewed towards London, the South East and major cities.
That is now changing as the crisis spreads, but the damage is done. Huge parts of Britain are unaffordable for both buyers and private renters, while those which remain just about affordable lack job opportunities. Yet there is no guarantee whoever fills May’s shoes will take housing so seriously or seek such good advice.
Britain came to rely too heavily on rising house prices to shore up our economy and now we are paying the price. Ansell’s data is enlightening. It serves as a stark reminder for whoever takes over from May that, while they must sort Brexit out, they cannot afford to ignore the housing crisis – in all its complexity – if they want their party to survive the onslaught it currently faces.