Research Review: Turning Generation Rent into Home Owner


by Jo Pitt, CIPFA Local Government Technical Manager

"You never really understand a person until you have considered things from his point of view" - Harper Lee

Each week there are hundreds of pieces of research that are relevant to those working in Local Authority. Much of the work is well evidenced, thought provoking and demands more of our attention than we can afford to give it. While often we might not necessarily agree with comments or recommendations contained within research, it is always important to be aware of new thoughts, ideas and the views of others.

In this new section of the Local Government faculty newsletter we intend to select a piece of recent research that we think is worth you knowing about and summarise its key message. This month we have selected 'Turning generation rent into home owner' by Localis.

Localis is an independent think-tank dedicated to issues related to politics, public service reform and localism.


This paper is focused on Generation Rent as the document identifies "those under 40s that are prospective first-time buyers, yet stuck in the renting cycle and struggling to save for a deposit."

This group faces commonly understood problems:

• the price of property is too high
• their rental expenditure is high 
• mortgages are more difficult to acquire

Localis explore a number of issues that need to be addressed as part of this debate. The research explores the idea that government should move from rent to buy to save to buy. Suggesting that this would be a more successful that the rent to buy scheme. They would combine this with the Living rent rate a concept supported by others. This reduced the market rent to something more affordable therefore allowing renters to save for a deposit.

The report then argues that the government could then support a mortgage deposit scheme that uses the concept of 100% mortgagees. It argues that "since 2009, repossession rates for home owners has fallen reaching its lowest ever rate in the first quarter of 2016. This means that the risk for Government of providing the mortgage guarantee would be relatively low". Perhaps it’s most contentious suggestions are about the use of land and the challenge to the green belt. It quite rightly acknowledges that: "No other policy which is so impactful gets such little critical attention." While it is critical of this 1930’s policy it also considers that lessons can be learnt from past achievements and talks about the reinvention of the 1944 Abercrombie plan for Greater London.

The five issues dominating Abercrombie’s plan 70 years ago were growth, housing, employment and industry, recreation and transport. These still ring very true in many current local authority plans and it is interesting to see how this piece of work leaves historical lesson’s into future policy. 


The four recommendations made by Localis in this report to Government address both the inability to save for a deposit and the supply of housing. 

"1.Government should revise its Rent to Buy scheme to become Save to Buy, a product which provides Generation Rent with subsidised Living Rent and the financial headroom with which to obligatorily save for a deposit.

2. Government should establish a Deposit Guarantee scheme for first-time buyers under 40 (or most appropriate age determined by Government) purchasing new-build homes.

3. Government should commission the development of ‘Abercrombie 2.0’, a new master plan for the release of new land for housing across London and the South East.

4. Government should commission a comprehensive review of the Green Belt. This should be focused on London and the South East but with reference to other metropolitan Green Belts".

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