In a previous article we saw that recent government housing policies have sought to make council tenancy the residual tenancy category, thus giving it the same stigma as the dole. However, below the council tenant there is a significant number of workers, many of them small family groupings, such as single parent families and young newlyweds with perhaps one child; others are immigrants suffering discrimination and ostracism. The present stock of council houses have quite a high proportion with three bedrooms and it is “inefficient" to place these small families there. While attempts to enforce minimum standards tend to be defeated by recurring drives to reduce “public" spending, when they are followed they can aggravate this “problem”. This happened to a certain extent under the 1945-51 Labour government.
The result is that these groups are thrown onto what is left of private rental. It also leads to the standard of this accommodation being well below that of council housing, 68.5 per cent being built before 1914 as against 3.7 per cent of the “public” sector and 30 per cent of “owner-occupied" (J.R. Short, The Post War Experience: Housing in Britain. University Paperbacks. 1982). While the standard of “owner-occupied" houses, taken as a whole, is above that of council accommodation, significant exceptions are developing, mainly in inner city areas. Here many older private sector houses have been abandoned as these areas have depopulated and the emphasis of housing policy has shifted from clearance to renovation. Demand for these has been particularly strong among immigrants, particularly Asians.
In the earlier article we said that we would use the term "owner-occupier" in its current sense, even though it lumps together capitalists with those who arc really anything but owners, having in some cases not one but two or even three mortgages to repay. On this topic Martin Pawley (House Ownership, The Architectural Press. London, 1978) has an unusual viewpoint:
Compared to the property owners of history we might he tempted to suppose that today's owner occupier is hardly a property owner at all. In contrast to the great estates of the past, his property is rarely handed on from father to son and indeed on average remains in his hands for only five or six years before being exchanged for something better. The size of his possession too leaves something to be desired; both dwelling and plot of land being so small that the poorest yeoman of the Feudal era disposed of greater estates. Furthermore the triumph of the flexible interest mortgage means that his wealth is dependent on the vagaries of interest rates and employment: his home only being a castle to the extent that his credit card is a shield. Yet even this uncertainty has historical parallels: the Feudal knight or farmer enjoyed rights over his fiefdom only so long as his landlord could (with his compulsory aid) defend it himself. During the Wars of the Roses . . . numerous estates were confiscated and bestowed on others, only to be confiscated again according to the ebb and flow of advantage during the struggle . . . Like the modern mortgage holder the medieval land-owner had no absolute title to his property, only certain rights which a run of adverse circumstances could remove altogether.
The previous article also touched on the discrimination applied by the building societies in allocating mortgages. In their efforts to ensure that their money is safely invested they inevitably tend to make the largest loans to those least in need. In order to reduce expenditure on “public” housing, governments have introduced schemes to get round these mortgage restrictions, one of which gives powers to local authorities to enter the mortgage business themselves. In 1971 the Heath government laid down explicit guidelines on who these loans could be made to. As easier terms on initial deposit mean larger repayments, these dictates illustrate the difficulties faced by lower paid workers. Out of seven groups specified the following two are specially significant (quoted from Short op. cit.): (a) Applicants who are homeless, threatened with homelessness or living in overcrowded or unhealthy conditions, (b) Applicants who wish to buy older or smaller property but who are unlikely to get a commercial mortgage". It might have been expected that these would have been found council housing in the “residual tenure" category. And of course few workers “wish" to live in old small dwellings; they are forced to settle for them because that is all they can afford.
For workers with some measure of choice there are a few advantages to owner-occupation. For those who have been able to stay in one place for some time, repayments on a house “bought" 15 years ago for £4,500, but selling today at £22,000, would only be about £7.50 a week. This situation however can only continue if government policies of inflating the currency continue. In these cases the burden has been shifted onto first time buyers saddled with inflated prices and high rates of interests.
Tax relief on mortgage repayments was until recently considered a great benefit of the mortgage system. In fact the workers do not pay tax. The price of their labour power as a wage or salary reflects the cost of their means of subsistence. Of necessity it is the take-home pay which corresponds to this price so that any tax deduction is in reality a charge on the employer, not the worker. The increase in house prices since the war is again something which may not continue. Taking advantage of the situation is not easy, for the workers must have somewhere to live. Older workers whose children have left home can sometimes sell and take smaller accommodation. For most however any gain would be at the expense of moving into an inferior dwelling, or alternatively subletting rooms, a common practice among tenants also. High house prices reflect a shortage of cheaper working class dwellings which the building interests will be reluctant to change for fear of lowering prices. Housing is a commodity produced to make profits, not because workers require a roof over their heads.
Further evidence of the plight of the low paid is given by Mary Smith (Guide to Housing. Housing Trust Centre. London, 1977). The proportion of first time buyers has been falling for some time, from 63 per cent in 1969 to 47 per cent in 1975. More "owners" are now mortgagees, 58 per cent in 1975 against 52 percent in 1965, with correspondingly fewer outright owners. (Private landlords are included in this assessment.) In 1976 the number of mortgages allocated to first time buyers of new houses had fallen to 9 per cent.
These increasing inequalities within the mortgage paying bracket are illustrated by information given by Short (op. cit.) on the distribution of what he calls “economically inactive household heads”. Such a hybrid term encompasses capitalists, retired workers and the unemployed, a type of confusion-mongering which cannot be entirely accidental. We must therefore use Short's information with some care. First we find that over Britain as a whole 33 per cent of household heads are classed as inactive. However, among the “owner occupiers" only 4 per cent of those paying off mortgages come into this category, but as many as 57 per cent of outright owners qualify. The message here is pretty clear: attempted purchase is for workers who have steady jobs. If unemployment strikes the worker will probably have to sell. In contrast, outright owners comprise mainly capitalists and retired workers. From this we see again that most workers who do become outright owners are near retiring age, and retirement usually means a drop in income.
Just as interesting are statistics given by Short of housing assets as a proportion of gross personal wealth. Housing assets are calculated by subtracting outstanding mortgage repayments from the market price. The following table, which is based on 1980 figures, compares the percentage of housing assets and company securities for gross personal wealth up to £200,000.
Where workers are able to make a choice between tenancy and the mortgage game it is of little concern what they decide, but political actions aimed at altering tenure distributions, in whatever direction, are an entirely different matter. On an individual level, workers "buying" a home, preoccupied with DIY decorations (or to quote Pawley, with “balancing car port against loft conversion against kitchen modernisation") may be turning their attention from the class struggle. Socialist workers, whatever their form of accommodation, realise their subservient position and the similar plight of the rest of their class, irrespective of the type of dwellings they inhabit. Their attention cannot be distracted by the superficial. but is concentrated instead on how to end the housing problem once and for all.
E C Edge