I tend to be very cautious about drawing conclusions from statistical associations, but there is an association between high levels of renting and economic success. The continuing policies to convert rented accommodation to private ownership, which David Cameron reiterated in his presentation to the Conservative Party Conference is deeply worrying

The percentage of the population living in rented accommodation in the UK is already below the EU average, and those with high proportions of rented accommodation are generally the rich and successful countries.

Percentage renting
Germany 52%
Netherlands 43%
Denmark 42%
Austria 41%
Poland 38%
France 38%
Sweden 38%
Finland 32%
Belgium 31%
EU average 29%
U K 27%

Countries with very few households in the rented sector are relatively poor.

Percentage renting
Slovakia 10%
Estonia 8%
Slovenia 8%
Hungary 7%
Lithuania 3%
Romania 2%

There is a plausible reason for this association. Rented accommodation makes it cheap and easy to move closer to work, to progress a career and to reduce the need to commute long distances.

Owner Occupiers who do not want to move may become and remain unemployed if the local economy declines or may commute long distances. Commuting is all cost and no benefit!

Owner Occupiers who do move generate fees for Estate Agents, revenue for the Treasury in Stamp Duty, and advertisements in the property pages in local papers. None of this helps the economy.

It is worth looking carefully at the benefits of renting, and its association with successful economies, and resist calls to make councils and housing associations transfer their rented properties to private owners.

David Walker (8 Oct 2015)

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