The Rentier Is The Landlord, Not Your Grandmother

Tribune opens its argument on the fact that gives the game away: this is an era in which landlords have been redefined as working people. Nick Bano's case in Against Landlords is that Britain's housing crisis "is less one of supply, and more to do with an inflated private rental sector — with a petit-bourgeois class of landlords uniquely placed to cash in on high housing costs at the expense of a growing body of immiserated renters". Not a generation. A position in a market, occupied by whoever occupies it.

The housing stock supports him. The private rented sector has exploded since the late 1970s while the country acquired more homes than there are households, more rooms per head than most of Europe, and hundreds of thousands of empty homes — by some counts almost a million, around one in twenty-five. A shortage that coexists with a million empty houses is not a shortage of houses. It is a shortage of houses anyone can afford, which is a different problem with different owners.

Set the young against the old and both will be renting from the same people at the end of it.

What drives the price is the treatment of a house as a financial asset. Investors, landlords and buyers acquire homes as investments and together bid the price up; because the supply of money for buying housing is elastic, the process feeds itself. Tribune presses this against Bano himself, whose own intervention keeps international finance out of the indictment. The review has the better of it: financialisation is not a foreign import, it is what the domestic mortgage market became once credit was deregulated and the state stopped building.

And the loss the young have suffered is a wage loss before it is an inheritance loss. By 2023 the post-crisis flatlining of pay had left workers on average £11,000 a year worse off than the pre-crisis trend implied, and £4,000 behind their German counterparts; in 2022, 56 per cent of workers earning below the minimum cost of living reported using a food bank. Nobody's grandmother did that. It was done by employers, by a decade of austerity, and by a housing market nobody was willing to touch.

Tribune opens its argument on the fact that gives the game away: this is an era in which landlords have been redefined as working people. Nick Bano's case in Against Landlords is that Britain's housing crisis "is less one of supply, and more to do with an inflated private rental sector — with a petit-bourgeois class of landlords uniquely placed to cash in on high housing costs at the expense of a growing body of immiserated renters". Not a generation. A position in a market, occupied by whoever occupies it — which is why the generational frame is not merely inaccurate but useful to somebody.

The housing stock supports him, and the numbers are not obscure. The private rented sector has exploded in size since the late 1970s while the country acquired more homes than there are households, more rooms per head than most European countries, and hundreds of thousands of empty homes — by some counts almost a million, around one in twenty-five. A shortage that coexists with a million empty houses is not a shortage of houses. It is a shortage of houses anybody can afford, which is a different problem, with different beneficiaries, and it will not be solved by handing developers a bonfire of planning rules and hoping.

Set the young against the old and both will be renting from the same people at the end of it.

What drives the price is the treatment of a house as a financial asset. Investors, landlords and ordinary buyers acquire homes as investments and together bid the price up; because the supply of money for buying housing is elastic, the process feeds itself, and rising prices become the reason to buy. Tribune presses this against Bano himself, whose own intervention keeps international finance capital out of the indictment on the grounds that domestic finance is no kinder. The review has the better of it on the point that matters: financialisation is not a foreign import to be sealed out at the border. It is what the domestic mortgage market became once credit was deregulated, right to buy emptied the social stock, and the state stopped building.

The objection from the other side is that the arithmetic is real whatever the rhetoric — that pensions and healthcare for a larger old population must be paid by a smaller working one, and that saying so is not a smear. That is true and it is not the argument being made against us. The dispute is over what to do about it. One answer taxes the wage of a nurse who will never own anything to fund a transfer to a household that owns two houses. The other taxes the second house. Both are redistribution; only one of them is described as such.

And the loss the young have actually suffered is a wage loss before it is an inheritance loss. By 2023 the post-crisis flatlining of pay had left UK workers on average £11,000 a year worse off than if pre-crisis trends had continued, and £4,000 behind their German counterparts; in 2022, 56 per cent of workers earning below the minimum cost of living reported using a food bank. That did not happen because somebody's grandmother received her pension. It happened because employers held wages down for fifteen years, because austerity removed the social infrastructure that used to absorb the shock, and because every government of the period treated a rising house price as evidence of success.

Which is why this reading refuses the question as posed. The retired are not a class; most of them are people who worked, and a great many of them are poor. The landlord is a class, the asset manager is a class, and the privatised water company charging a household for the rain that falls on it is an institution with shareholders and a name. When all that is left is the rentier economy — when a household that rents is working, in the end, only to pay somebody else's interest — the thing to name is the interest and the person collecting it, not the birth year of the person in the next street.