Monday, 10 June 2013

on home ownership

i've finally managed to get some time to write about stuff - here's a post over at my website about the hectic weekend i've had.

i was listening to morning report on my way to work & heard this item on home ownership.  it's basically a couple of economists trying to convince us that nz'ers should no longer dream of home ownership.  instead we should be content with renting, although they do tell us that the rental market needs to change so that people can rent for the long-term.  nice of them.

until the rental market changes, what are people supposed to do?  and who exactly are they to be renting from?  in the world these economists are telling us to aspire to, we would have one class of people who get to own property to rent out, and another class of people who would always be renting.  The perpetual tenants are apparently able to build up just as much wealth as the property owners, simply by saving & investing the difference between what they pay in rent & what they would have paid towards a mortgage.

if that's the case, then they would build up enough wealth to buy a house, surely?  so they may as well just own the house they live in.  this is assuming, also, that there are in a position to make savings.  the problem at the moment, the reason why the home-ownership dream is becoming impossible for an increasing number of people, is precisely because they don't have enough left over to save.

but more than that, if you listen to the clip, don't you just love (ie really hate) how they dismiss "emotional" reasons for owning a home.  as if emotions have no value, no basis in logic and reason.  as if emotion is a thing that is divorced from and inferior to rationality.  which is nonsense.  if owning a home has some benefits that are based on emotional reasons, then those reasons will impact on your general feeling of well-being, and therefore your mental health.

a paper by charles waldegrave, robert stevens & peter king (which i can't seem to link to, but you can find a pdf via google), makes the following point:

Home ownership often provides an accruing asset which changes people’s perceptions about themselves in positive and independent ways. It also has the extra advantage of providing freehold ownership in later years when most senior citizens are not part of the work force.

home ownership also has the benefits of providing stability, better educational outcomes for children & better health outcomes.

so what would be the purpose of trying to convince people that they should give up the dream of owning their own home?  it could be to distract from the fact that one of the main barriers to home ownership is income inequality.  it could be to try to get us to accept that nothing can be done to make homes more affordable.  there's always that pressure to make more land available to developers, which you will also hear mentioned in the interview, as if big sprawling cities will solve the home ownership problem.  if you can't afford the transport to get to your job or to decent schools; if there aren't decent amenities & council services, and the cost of these are added to your house, then more land isn't the answer either.

the whole tenor of this piece, and of the advice given by the economists interviewed, was so defeatist.  i found it alarming.  it's when we give up hope & stop agitating for change, when believe things can never get better, that's when the already powerful & wealthy become even more so, and when the lives of those in poverty get worse.  we can do better than this.  it's just a matter of public will, which will then translate to political will.

i've been thinking of bob marley for some reason today, and so i'll leave you with this as inspiration:


Fragged said...

As somebody who doesn't aspire to own a home I don't think that it impacts my health that I don't, and I find any academic studies telling me that my health is impacted when my own lived experience tells me otherwise annoying at best and offensively patronising at worst.

The idea that everyone must own a home is simply another aspect of capitalist marketing - first, create a problem, then, tell us they have a solution to the problem. Many indigenous societies have no concept of 'home ownership' and they got by just fine, if not better, as home owners in western capitalist societies do... at least until western capitalists came along.

We need to look at the big picture questions, not just accepting the capitalist message that property ownership brings health, happiness and education.

stargazer said...

just because it's not affecting you personally doesn't mean it's the same for everyone. it's the overall, societal impacts & trends that are important.

re tribal societies, unless you are talking about nomadic societies, they belonged to villages, to places & had connections that tended to be lifelong. they also tended to work as collectives, so while they may or may not have individually owned bits of land & the houses on them, they often tended to collectively claim ownership of land.

even with nomadic tribes, while they didn't have a permanent place of abode, they travelled together in a group, so again had the benefits of collective action and connections with people who were familiar & known to them for a whole lifetime.

but these are all very different ways of living & i'm not opposed to those. if we want to move to such models, it will involve a fundamental change in the structure of society, and there needs to be activism & agitation for such change to occur.

what the economists in the clip are offering us is none of that. all they give us is a defeatist attitude of accepting that some people get to be property owners & collect wealth, while others should just be content to rent.

Peter H said...

Hello Anjum
Good to meet you at Livingstreet meeting.
From the Affordability report I note.
p11. nearly 30% of all homes constructed in 1949 were state rentals.
P12. 1954, 33.6% of all new homes benefitted from a State Advances loan.

Looks to me that the Housing market struggles without government being a active partner.
One good thing is Housing NZ has not decreased their housing stock in Hamilton. Which is at about 2,800 dwelling?
Looking at Hamilton City Council housing stock. 2004 we had 452 Dwelling, Now 2013 we have 345 Dwellings.

Be interested in knowing what the cost of building 100 dwellings to get HCC housing stock back to where it was 10 years ago