Recovery ‘won’t feel real’ until property ladder comes into reach

Recovery ‘won’t feel real’ until property ladder comes into reach

A general election to be fought on the economy and the cost of living could see politicians competing to win voters’ confidence on the cost of housing, according to a Populus poll.

The survey of more than 4000 British adults, commissioned by KPMG and Shelter, confirms that the economy and cost of living continue to dominate voting intentions for the 2015 election.

But the research suggests that politicians will struggle to capitalise on any public optimism about the economy until they address a handful of critical issues that stop the recovery "feeling real" to voters.

More than a third (38%) say they think an economic recovery is underway. However, just 1 in 10 (11%) agree that an economic recovery is taking place which they feel part of.

Almost half (49%) say that they would need to see wages rise before a recovery felt real for them and their family, while a third (36%) and a quarter (24%) respectively say that unemployment and inflation would need to fall.

Many cited the high cost of buying a home, with 69% saying that any recovery "won’t feel real" until it gets easier for young people to own a home.

More people said that rising house prices make them feel worse, rather than better, about their family’s future.

Meanwhile, the majority (72%) of those concerned by the cost of living say the situation would be improved by lower housing costs.

The research also uncovers emerging signs that policies like Help to Buy are yet to capture the public’s confidence. In spite of the scheme, just 8% of the public say that prospects for homeownership for young people have improved in recent times.

Instead, 3 in 4 say that young people’s prospects of homeownership have actually worsened over the past few years, and more dramatically when compared with other issues. This means the public feels that the next generation’s hope of owning a home has worsened more than youth unemployment or wages.

The research sounds a warning signal to politicians of all parties that they need to go further to win the trust of voters worried about the next generation’s prospects of owning a home of their own.

But the poll also hints at the size of the political opportunity to play for, with more than a third (39%) of those polled – the largest proportion – saying that they don’t yet trust any party on the issue.

Rick Nye, Managing Director of Populus, warned that with housing becoming central to the public’s sense of economic confidence, politicians ignore it at their peril.

“The availability and affordability of housing will play a significant role in the next election, but it is most likely to play out through other issues. Nearly half of voters say the state of the economy or living costs will be among the most important issues at the next election, and nearly three quarters of those say that lower housing costs would improve their view of these.

"A majority of people believe that the prospects for young people owning their own home have deteriorated in recent years and three in ten parents think they will be unable to help their children to buy their first home if asked.”

Marianne Fallon, Head of Corporate Affairs at KPMG, said: “This research underlines the importance of housing in people’s lives. An accessible and affordable housing market is vital if people and families are to be able to build on their aspirations and unlock their potential.  It’s important for business too, to know that staff can afford to live within reach of where they are located.”

Campbell Robb, chief executive of Shelter, said: “From priced out young couples to families facing homelessness, every day our advisers see the reality that our housing shortage is now hitting people from all walks of life, and across the income scale.

"This poll makes it clear that no political leader can win the trust of voters on the economy or the cost of living without addressing high rents and house prices. But what we haven’t yet seen is any party putting forward the big, bold vision we need to deliver more affordable homes.”