Britain's employment challenge is also a housing issue
With almost a million young people now not in education, employment or training (NEET), campaigner and NRLA member Jens Winton argues rented housing – and its taxation – must take centre stage when it comes to policymaking.
“Britain does not lack organisations with a role in supporting young people. It lacks a coherent participation system designed to ensure they make a supported and sustained transition into adulthood.”
That observation comes from Young People and Work: Interim Report, the recent review by former Health Secretary Alan Milburn into the growing number of young people not in education, employment or training (NEET).
Milburn’s review focuses on education, employment, health and welfare. Yet there is another factor that deserves greater attention: housing.
Housing vital for labour mobility
The debate around young people and work often assumes a simple sequence. First comes employment, then income, then housing.
In reality, the relationship works both ways. A young person cannot easily pursue opportunity if they cannot access the housing that makes opportunity practical.
A job offer in another town or city means little if there is nowhere affordable to live. An apprenticeship becomes less attractive if rent consumes most of the wage before the first payslip arrives. Housing is not merely a consequence of opportunity; it is often a precondition for it.
Milburn describes communities “where one in five young adults are outside education and work, and where the local economy can feel like it consists of little more than a supermarket and a care home.”
For a young person in such a community, mobility matters. The ability to move for work, training or education can be life-changing. Yet mobility depends on housing options being available when and where they are needed.
Historically, the private rented sector often provided that bridge. The first room in a shared house, the modest flat near a new job, the temporary home that allowed someone to take a chance on a different future.
This should concern anyone serious about tackling economic inactivity among young people because the question is not simply how they find work. It is how they build lives.
The PRS as a stepping stone
Much of the housing debate assumes that reducing private renting is inherently positive because it creates opportunities for owner occupation. Yet for many younger adults, rented housing is not an alternative to homeownership but a stepping stone towards it. That is where housing policy and employment policy begin to overlap.
Britain is also entering a fleeting one-off cycle sometimes described as the “Silver Tsunami”, as Baby Boomers pass on accumulated housing wealth through inheritance. Rather than assuming such homes should leave the rental sector, policymakers could ask how more owners might be supported to operate professionally and responsibly.
Organisations such as the NRLA already provide training, guidance and compliance support that could help accidental landlords become responsible housing providers.
The role of taxation
But part of that debate also concerns taxation. Unlike many other small businesses, individual landlords cannot fully deduct finance costs before calculating taxable profits.
Policymakers often justify such measures on the basis that they dampen investor demand and improve opportunities for owner occupiers. Yet that assessment may overlook another question: what happens to labour mobility and social mobility when flexible rented accommodation becomes scarcer?
Whatever the original intention behind those reforms, policymakers should be willing to ask whether a tax system that treats borrowing differently for small housing providers is consistent with a desire to maintain housing mobility and local rental supply.
The issue is not special treatment. It is whether housing should be treated less favourably than many other small businesses when government says it wants greater mobility for young adults.
If policymakers want inherited properties and other small-scale rental homes to remain available to the next generation, taxation, regulation and support mechanisms should all point in the same direction.
What often disappears when smaller landlords exit is not a luxury apartment in a city-centre tower. It is the room above a shop, the inherited terrace house or the modest flat near a first job or apprenticeship. Those are not abstract housing units. They are escape routes from a childhood bedroom.
Housing key to employment conversation
Milburn’s review rightly asks how Britain can help more young people move into work. Yet work and housing are not competing priorities. They are twin foundations of independence. If policymakers want to create a coherent system that helps young people make the transition into adulthood, housing cannot remain outside the conversation.
The NEET debate asks how young people can find work. Housing policy increasingly asks how more people can become homeowners. Both are legitimate goals. But if policymakers focus on ownership alone, they risk overlooking the role that flexible rented housing plays in helping young people reach the point where ownership becomes possible.
The bigger question is how they can build lives.
How can I make my voice heard?
There is a current petition on the UK Parliament and UK Government site asking for all mortgage interest to be deducted when calculating taxable rental income.
Almost 6,000 people have signed the petition so far – with a Government response guaranteed if it hits 10,000.
If numbers hit 100,000 it will be considered for debate in Parliament.
The petition is open until 19th August, and you can click here to add your signature.
