ONCE upon a time, in the 1960s, Scotland was notorious because more of its people lived in public rented accommodation than anywhere in Europe outside the Iron Curtain.
But when Margaret Thatcher offered them the right to buy their council house, it emerged that, despite what many politicians had said, most Scots had long harboured a secret desire to own their own home.
For the past 30 years, young Scots have looked forward automatically to leaving the nest, buying a starter flat, then owning a family home of their own, probably in some new suburban estate. Not any longer.
With double-dip recession and restricted bank lending, getting on the housing ladder is becoming more and more difficult. Now it appears that most Scots – those without ready access to the bank of mum and dad – will have to wait until their forties before being able to save enough to buy their first home. No wonder 41 per cent of young Britons say they have abandoned any intention of buying property at all.
Should we care? After all, there is a thriving private rented sector with more choice than in the days of mass council housing. And given today’s minuscule interest rates, renting property provides a higher return for the average pension pot than leaving cash in the bank.
Certainly, society should have a mix of rented and owned accommodation. But the current exclusion of young people from the housing market is not a matter of choice, but of economic rationing by a banking system that will not or cannot lend. As a result, young adults are having to live longer with their parents, labour mobility is being restricted and towns are becoming segregated on class lines, as only the cash rich can buy property.
At the end of last year, the average loan to value on a mortgage in Scotland was 72 per cent. The bottom line is that mortgages have to be easier to obtain. No one is suggesting banks become as profligate with loans as they were. Equally, the rules requiring banks to build capital reserves are actually now more onerous in Britain than in Europe, with the result banks are less able to lend. Those rules could be eased, even temporarily.
Another suggestion is that the Bank of England uses its quantitative easing programme to buy bundles of new mortgages issued directly by volume house builders. That would underwrite the risk of property lending and provide significant new capital for construction. It would also boost economic growth without the UK government having to borrow and create jobs.
Scottish housing construction is half what it was five years ago. Reversing that could add a percentage point to GDP.
Recently, the IMF advised the government that if growth did not pick up by the end of 2012 it should reassess its austerity strategy. Why wait? Why should Scots wait till middle age to own their own home?
Basking in the Olympic glow
One fact about this summer’s London Olympic and Paralympic Games is incontestable: public support in Britain surpassed every forecast. It did not flag even for yesterday’s splendid victory parade of Team GB athletes through London, which brought out the crowds in hundreds of thousands. Sunday’s finale defied worries that public boredom might have set in, with a sell-out audience of 80,000.
No amount of hyperbole, or the sound of politicians climbing on bandwagons, can alter the reality that ordinary Britons loved the Olympics and felt they had been a part of collective national – British – success, in organisation and athletic prowess.
Will this collective spirit last? The Prime Minister has (rightly) called these Olympics “the best ever”. But is he correct to believe the glow from this “golden summer” will continue and perhaps, he hopes privately, influence the outcome of the independence referendum? That would be wishful thinking. While the summer was truly golden in the Olympic Stadium, a cold wind of economic recession was blowing in Britain. In 24 months’ time, if the UK is still in the economic doldrums, appeals by Mr Cameron to the “Olympic spirit” will sound decidedly hollow.
Equally, Alex Salmond should think twice about claiming successes by the Scottish team at the 2014 Commonwealth Games as his own. Instead, he might devote his undoubted skills to filling in the many gaps in the SNP’s policy prescription for independence.
As for the rest of us, we are still celebrating the athletes and volunteers of the London Olympics. They are, and will remain for a long time to come, a genuine inspiration.