Soon Money Will Buy You Happiness
The National Housing Federation reported this week that the average house will cost £300,000 in five years' time.
With few houses set to be built in that timeframe and there being no lack of demand which would bring about a fall in prices, we are pretty much buggered.
This generation of students – and seemingly the next one too – will find it impossible to own a house of their own, and only the very rich will be able to prosper by buying–to–let. The gap between the rich and poor will inevitably grow, with the poor becoming a bigger group.
So the adage that "money can't buy you happiness" is set to become false. Maybe it's a bit extreme to say that without a mortgage you can't be happy, but until you own something as fundamental as a house, many people will feel unfulfilled. Moreover, those who want to build their dream home (and they need not be loaded to do so), will in the future find their dreams evaporate.
This causes other problems. Younger homeowners are more likely to desire an environmentally–friendly home, are more likely to put solar panels on their roof and wind turbines in their garden. But if the vast majority of young people are renting until well into their 30s (as looks probable) then the move towards more sustainable housing will slow.
There's been much talk about the 'politics of happiness' recently, helped by a TV series on BBC Two and mention of it from David Cameron. The former was a bit drawn out while the latter sounded like opportunism, but the 'happiness formula' will become far more important as a whole generation finds it can't afford somewhere permanent to live.
Money might not be the be–all–and–end–all, but the gap between the haves and have–nots is becoming ever–larger as affordable housing becomes more and more invisible.