Inequality in housing wealth has risen spectacularly in England & Wales
ebarlow
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Context:
Housing wealth is the value of housing assets held by an individual. For many households, this is by far their largest source of wealth.
The growth in homeownership during the 1980s and 1990s and rapid increases in house prices in some parts of the UK, led to concerns that a gulf was emerging in housing wealth.
Findings:
Between 2006 and 2017, inequality in housing wealth rose sharply in England and Wales, far more rapidly than inequalities in income and employment.
Most of this rise in housing wealth inequality was due to large regional disparities in house price increases, with house values in London and the South East pulling away from other parts of the country.
This finding raises new concerns about housing wealth becoming a major driver of inequality, both between renters and owners, and between different UK regions.
There are also concerns that these changes will exacerbate the transfer of inequality down generations as housing wealth is passed onto children and grand-children with potentially significant impacts on inequalities in life outcomes.
Policy implications:
There is an imperative to reform the taxation of inheritance and housing, particularly since much of the gains from housing wealth are to where residents happen to live rather than their effort or talent.
Context:
Findings:
Policy implications:
Related publication: “The Rise of Housing Wealth Inequality: How the Financial Crisis Initiated a New Era of Growing Regional Inequalities in Gross Housing Wealth in England and Wales” (forthcoming).