Poverty and Home Ownership in Contemporary Britain

Poverty and Home Ownership in Contemporary Britain

Poverty and Home Ownership in Contemporary Britain

Poverty and Home Ownership in Contemporary Britain


Half of those living in poverty in Britain today are home owners. Yet current government policy is not oriented to this reality. Drawing on data from the Joseph Rowntree Foundation's Poverty and Social Exclusion Survey of Britain, this report presents a detailed picture of the realities of home ownership at the margins and provides evidence in support of the need for radical changes in policy towards sustainable home ownership. It examines the relationship between poverty and home ownership in contemporary Britain analyses the Poverty and Social Exclusion Survey - a data source expressly designed for the purposes of measuring poverty concludes that we need to rethink dominant perceptions about poverty and housing tenure; and makes the case for the need to re-evaluate the role of the state in assisting with housing costs.The report's findings are important reading for housing and social policy academics and analysts, and policy makers working at the interface of housing and social security policy. Mortgage lenders will also find the report valuable reading, as will anyone interested in housing and poverty.


In general, home ownership and poverty have rarely been linked together. the prevailing, popular view of owner occupation is one that associates the tenure with the middle class and more affluent households. in many minds the tenure remains associated with investment and accumulation, and, for these and other reasons, home ownership is still most people’s aspiration.

In some respects, these views of home ownership as an affluent, middle-class tenure are well founded. the majority of owner occupiers (those with a mortgage and outright owners) belong to the professional, managerial and intermediate non-manual groups – 60% in 1980 and 62% in 1998. the average gross weekly household income of all owners in 1998 was £555 compared to £203 among local authority tenants (Wilcox, 2000). These figures, however, conceal the diversity of the tenure even though this diversity has long been recognised by housing researchers (Karn, 1979; Forrest et al, 1990). One aspect of this diversity is low-income home ownership. a study of home owners in Birmingham in 1979 was one of the first to draw attention to this development (Karn, 1979), while studies in the late 1980s and early 1990s noted the incidence of unemployment, home ownership and poverty (Ford and Wilcox, 1992; Davis and Dhooge, 1993). It is only recently, however, that there has been a more systematic consideration of the extent of poverty and home ownership.

In Half the poor: Home owners with low incomes, Burrows and Wilcox (2000) suggested that 12% of home owners were poor. More strikingly, they also noted that, from the point of view of those who could be defined as poor (using the measure of households below average income), half of these households owned or were buying their own homes. Further, the proportion of the poor who are home owners has grown rapidly since 1979. Among the lowest income decile (measured before housing costs are taken into account), home ownership grew by 18 percentage points to 57% between 1979 and 1997/98, yet the dominance of home ownership within society can make these developments and their implications difficult to recognise.

The growth of home ownership among poor households is connected, in part, with the policy to expand home ownership that accelerated particularly after 1979. the development of mass home ownership (the term ‘mature’ home ownership is sometimes used) was built on a series of policy interventions which created the fiscal and regulatory structures to support easier access, implemented policies allowing tenants to become owners by buying their previously rented properties, and limited the provision of social housing, particularly local authority housing. So, for example, the financial services sector was deregulated in 1984, creating a highly competitive market in which lenders vied for borrowers in contrast to a previous climate of mortgage rationing. Since 1979, over 1.8 million homes have been bought under the Right-to-Buy and other initiatives, and a proportion of these sales were to the lowest income group, although they were not the predominant beneficiaries. All of these policy initiatives resonated with households’ aspirations and, to different degrees, contributed to the growth of low-income home ownership.

But, if widening access has resulted in an increase in poor home owners, so too has the changed socioeconomic environment that sets the conditions under which households manage their housing costs. There is a growing awareness that home ownership is ‘riskier’ than it once was as a result of events that undermine the ability to meet mortgage payments. in particular, labour market disruption is more frequent, sometimes resulting in unemployment and sometimes re-employment at a lower wage, and . . .

Search by... Author
Show... All Results Primary Sources Peer-reviewed


An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.