Life is not great for young people
Many young people:
leave education and get decent jobs – some don’t,
leave education owing up to £45,000 in student loan debt,
many are on zero hours contracts or in the gig economy,
find it impossible to put together a deposit to buy a home,
end up with a 40 year mortgage - they may retire before paying it off,
find themselves paying very high rents,
find it difficult to save and impossible to invest in a pension scheme,
are still living at home,
continue to rely on “the bank of mum and dad”.
“The boomers”
The author of this page is a “boomer”. He comes from a rural background: a dilapidated medieval water mill, no electricity, water from a well, no TV, battery radio, no phone, no car, chemical toilet half way down the garden. While he was in the sixth form his family moved into a council house. He got a full grant for his degree and left university with money in his pocket. Companies were queuing up to give jobs to graduates and he came to Derby to work in computer management for Rolls Royce Aero Engine Division. He then studied for a Post Graduate Certificate in Education and taught for six years in a primary school. He and a colleague developed one of the first microcomputer word processors (before Microsoft Word), he set up a software company and he travelled the world selling software. After a first attempt to retire very early he invented a new product and set up a new company to sell the product world wide. He is now attempting to retire again but can’t stop inventing things. He was passionate about his work and he is passionate about LVT!
Key points:
He had an excellent free education.
He got a full grant to go to University - everything, including lodging and food, was paid for.
He got jobs he really enjoyed and felt passionate about.
He was able to buy his first home at the age of 23 with a mortgage based on 2.5 times his salary. In 2025 that multiple is 8 to 10 times in the South East.
He was able to put away enough money to ensure a comfortable retirement.
He worked hard (12/18 hour days at times!) and has been able to do everything he wanted to do in life.
Why was he able to do this?
Far fewer people went to university. In the 1960s it was less than 4%, by the late 1970s it was 14%, it is now approaching 38% - there are now 900,000 graduates every year! The state could afford to fund 4%, it can’t afford to fund 38%!
Do we need so many people to go to University and to saddle them with so much debt? Should young people’s abilities and skills be better applied elsewhere?
Housing was available and affordable., He spent two years in a grotty flat but was then able to buy a decent home (three bedrooms, detached, Edwardian, integral garage, large garden) based on what was then a fairly low salary.
Housing is now in short supply because:
people are living longer (average life expectancy has risen from 70 in the 1960s to 80 now) so houses don’t come on the market so often,
we have far more single person homes (30% today) ,
we have more second homes (over 800,000 today) ,
we have more holiday lets (over 70,000 today),
we have more airbnbs (almost 400,000 today),
our population has increased - from 52 million in the mid 1960s to 69 million today - a 33% increase in 60 years.
Rents have gone up because “Right to Buy” has taken over 2 million homes away from Local Authority (LA) social housing stock - 40% of those are now in the hands of private landlords. LAs were not allowed to build new homes for rent.
Land has increased dramatically in price and this has driven up house prices. This has driven up the profits of big developers who have almost total control of the number of houses built.,
Land Value Tax can help because it will:
Stabilise land prices, or even drive them down, because landholders will be paying tax on their land for the first time.
Get rid of the unfair system of Council Tax where a home in South Derbyshire pays twice as much as a mansion in London.
Spread the tax fairly across the country - it will be the same percentage everywhere.
Be paid by landlords (the freeholder), not by tenants.
End land banking by developers who sit on land until the price goes up. With LVT they will be paying the full tax and will therefore be encouraged to start building.
Be collected nationally to free up resources in LAs to speed up planning decisions and to hold developers to account.
Other changes are necessary:
LAs must be allowed to Borrow To Build for social housing to rent.
LAs must be allowed to use compulsory purchase of land for homes - at a price that does not provide a windfall profit for landholders.
Tenants and landlords must be protected by a register of all tenancies - Ireland does this with its Residential Tenancies Board.
Existing schemes like Help To Buy must be scrapped - they sound good but in the end they force up house prices and developers’ profits.
The economy must be managed to provide quality jobs while keeping inflation and interest rates low so mortgages are affordable.
A Citizens Bank should be created to hold savings 100% secure, to provide low cost mortgages for new home buyers and to enable saving for pensions.