Life, liberty, and property do not exist because men have made laws. On the contrary, it was the fact that life, liberty, and property existed beforehand that caused men to make laws in the first place. ~Frederic Bastiat
In the 1970s some local councils - including Bromley where my Dad was then Chair of Housing - began to explore the sale of Council houses to sitting tenants. These initial 'right to buy' ideas were tentative and limited - Councils lacked to power to incentivise the sale (beyond help with the actual process) and couldn't offer discounts or subsidies. However, these initial ideas led to what I consider - more than headline grabbing controls of trade union misbehaviour or the application of monetarist ideas to macroeconomic management - to be the defining piece of 'Thatcherite' legislation: the Housing Act 1980:
The act nationally implements a scheme of discounts against the market price of houses, to reflect the rent already paid by tenants and to encourage take-up. The scheme gives a generous minimum discount on the market price of 32 per cent for a house or 44 per cent for a flat, increasing each year to a maximum of 70 per cent.
Free market purists quail at this use of public subsidy and the progressive left bewail their loss of control over working-class tenure but this single act signalled a shift from the idea of collective ownership to the liberation that is private, personal ownership. Some 2 million properties transferred from state ownership to the ownership of the people who lived in them. It was the biggest ever transfer of wealth in the history of modern Britain.
The criticisms - leaving aside bien pensant nonsense - always boil down to a view that some people simply can't be trusted with owning things. The truth, however, is that - as even the Joseph Rowntree Foundation have shown:
Eighteen years on, there can be no doubting the impact of the Right to Buy. Some 30 per cent of tenants have exercised the Right to Buy. The majority of these have benefited considerably from the process. The volume of sales and capital receipts has far exceeded expectations.
The residual nature of council housing means that the rate of sale under right to buy has declined - there were just 3,700 sales of this sort in 2011. However that was still 3,700 families who have moved from the dulling embrace of the council to private ownership. And we know from experience just what this means - new doors are put in, gardens are better kept, the walls are fixed, leaky gutters mended and a sense of difference stamped on the place. All because ownership implies a desire - perhaps even a duty - of care for the property, a care that simply doesn't exist in circumstances of so-called common- or state- ownership.
Those who attack the government for promoting home ownership - all that chatter about bubbles and so forth - miss this point entirely. And to suggest that having a mortgage isn't ownership is to misunderstand the reality. Ask that man with a mortgage whether it's his house? He'll tell you it is and will behave as such - making sure it's looked after, sorting out its problems and defending the value of the property in whatever way he can.
Those who take the problems faced by a minority of homeowners - negative equity, mortgages stretching beyond retirement, foreclosure due to loss of earnings - and use them to condemn the idea of a property-owning democracy are peddling an extremely dangerous myth. The myth that the alternative - renting (I assume from the state out of preference) - is somehow preferable. Or rather preferable for that group of people most likely to get into trouble with mortgages - the people our bien pensants like to patronise.
If we are to have government fund the development of housing - and so long as the planning system remains as it is now this is the only way we will meet housing need - let it be on the basis that those moving into those homes will in the fullness of time get the chance to own those new homes. Instead of subsidised rents being simply a way to reduce housing benefit costs, let's use them to build up the funds to support people on the road to property ownership. And if that means deposit subsidy, tax reliefs and mortgage support so be it.
In the end property ownership makes democracy stronger, promotes independence and takes us another step nearer to a free society. To deny property rights, to claim government knows better or, worse, to assert that rights are created by man is to do the opposite - to take us back towards tyranny.
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