Could Labour entice two million scared property owners into switching allegiance?

28th September 2018 / United Kingdom
Could Labour entice two million scared property owners into switching allegiance?

By Graham Vanbergen: Last December, it was estimated that one in 30 adults is a landlord in Britain. What is astonishing is that around one-third of them is already retired. Around 77 per cent of landlords say they are reliant on their residential property investment for their retirement. This is because these people have lost complete trust in the government, the financial institutions and industry advisors to protect them, who between them throughout the last four decades have lost or swindled billions from hard-working individuals who now fear for their retirement years. Politicians are to blame for facilitating this crime and the corporations have plundered at will.


Findings from consumer market research show that buy-to-let is still seen as a safe way to save for later life. This is evidenced by the fact that 7 in 10 people believe it represents a good way to plan for retirement. They believe this because property ownership is fundamentally easy to understand and manage. It is a tangible asset, unlike a so-called managed fund open to market manipulation or political/taxation abuse.

The drip-drip effect of pension crisis after crisis has eroded trust almost entirely from Britain’s rising over 50s population. From Robert Maxwell’s £400 million pension grab of the Mirror Group in 1991 to Gordon Brown’s tax heist in 1997 that saw £100 billion skimmed from pension funds. From the government theft of pension surpluses of state-owned assets that were privatised to the Equitable Life scandal. The list of government-sanctioned destruction of trust in pensions also went on and on. It halved the amount of Serps benefits that widows or widowers could inherit upon the death of their spouse, it then switched the inflation link from RPI to the lower CPI knocking a further £110 billion off its pensions liability. It is not difficult to understand why people invest in a second property to keep poverty at bay in older age and stop relying on pension funds.

Then the 2008 financial services industry imploded. The cost to the taxpayer – over £500 billion. Savings interest collapsed and with it annual pay increases.

Then just two years later, a government report showed that young Britons are facing poverty in old age, by turning their backs on saving for a pension. The official figures also showed that the number of women aged 22 to 29 in the UK who are signing up for a workplace pension has fallen for four years in a row, the most rapid decline of any age group. Is there any surprise in this set of awful statistics?

The result is that millions have turned to the housing market as the returns on their savings dwindled or pension funds continually threatened. The rent from buy-to-let properties was estimated by 2017 to be something in the region of  £55bn-65bn a year.

Then the government turned on them because property owners are easy targets.

Richard Lambert, CEO at the National Landlords Association said: “As a consequence of government policy over recent decades two million people are reliant on their property to fund their later years, but the changing tax regime will substantially reduce the income they receive from these investments and so compromise the retirement plans of a significant number of hard-working people.

Is Labour is coming after these property-owning people as well? Announcing plans at the Liverpool Labour Conference, shadow housing secretary John Healey said: “Those who have done well out of the housing market should pay towards those with no home at all.” Labour will tax second homes used as holiday homes to help end the housing crisis facing thousands of destitute families in temporary accommodation. The danger for the Labour party here is not fully identifying those using second properties as pension investments.

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Healey said the second homes levy would raise more than £500m a year in a bid to ‘end the growing problem and scandal of kids with no home’. No mention has been made by Labour about second homeowners relying on these investments for their pension years.

However, by protecting these property-owning individuals who are merely defending their pensions, this is a group that would eagerly switch their political allegiance because they understand the implications of government policy on their futures. This group is an embattled middle class. They are not wealthy and not especially loyal Conservative voters. But they are frightened.

The wealthy do not plough their entire savings and cash pension funds from years of work in an attempt to protect themselves from poverty. The wealthy have their own tools to protect themselves. They invest in diversified types of risk using advisors who operate solely in that market. Most of their wealth is kept in a variety of secured and insured investments that carry low risk.

Would two million second homeowners vote Labour if they were confident they would be protected from additional taxation other than what already exists?

At Theresa May’s last (snap)election, the Conservative party got just 758,224 more votes than Labour.

Solving the housing crisis is a political must in Britain. Let’s be fair here – what is the point of any government if they are unable to house their own people? I strongly suggest there is a very high percentage of second homeowners here who would, in a heartbeat, switch their electoral allegiance to any party sympathetic to their circumstances who clearly and unambiguously spelt it out that they would not become taxation victims yet again.




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