In many ways, but not always, suffering is a reality for adolescents. You imagine your future and think about what is not yet in your power: a job, a partner, sometimes a family and, always, the independence and autonomy that we glimpse on summer nights. But navigating this path is not an individual task, but requires a whole series of declining collective supports: a secure labor market and robust social policies (family, education, housing). In the absence of such stepping stones, the transition to adulthood is an inaccessible Everest, even if you get up at five in the morning and do a hundred burpees, unless you can resort to Mom and Dad’s bench. .
In the absence of support, access to property has become, at the same time, the most important resource and challenge of our societies. For many households, owning a home is the primary means of accumulating and reproducing wealth; as well as private insurance against risks such as unemployment or poverty, especially in old age when income declines.
As a result, continued investment in housing has made its price extremely high. This is particularly the case where social rental housing is rare, a problem endemic in Spain, where it represents just 3.3% of housing. In the absence of this alternative, and in a context where restrictions are added to the mortgage market, new households are thrown into a private rental market which is therefore very tense. The figures speak for themselves: homeownership has continued to decline since the start of the century, particularly among the youngest (from 58% to 29%, from 2007 to 2023, according to the Living Conditions Survey) , while rent prices have skyrocketed.
A new generational contract
In this scenario, family support is increasingly important for young people, particularly through the assistance received to access housing. A first strategy consists of asset transfers, either to enable the purchase of housing or through the transfer of real estate. In the UK, 59% of home buyers under the age of 35 received financial help from family or friends in 2018. Another strategy is to share housing between different generations. In this way, housing costs are reduced or eliminated for the duration of co-residence, a phenomenon generally linked to the delay in the age of emancipation. Sometimes, the possibility of extending emancipation allows you to avoid the rental market and thus accumulate savings to access a property directly.
The growing importance of the family in access to housing has important consequences. First, it constitutes a new model of relations of transmission of resources between generations: exchanges mediated publicly (through pensions and social policies) lose weight in favor of their private organization within families (through housing). In this context, dependence on family support allows older people to discipline the lifestyles of young people. As a result, the generational contract is renegotiated around the degree of autonomy retained by those who benefit from support. If previously, caring for the elderly generated the expectation of an inheritance, what is the exchange when inheritances are given while still alive?
From 2040, the legacy of the baby boom generation will come into effect. But it will be very unequal: the richest 10% own 56.6% of the wealth.
The second consequence is the reproduction of inequalities both between generations and within each of them. On the one hand, we observe a profound dynamic of inequality whereby a (young) generation of tenants becomes poorer by enriching an (older) generation of households: “With an average age ten years higher than that of tenants, their median income per household is 76,504 euros, compared to (…) 27,984 euros for tenant households” (Future Policy Lab, 2023: 14). If the generation of tenants today experiences great difficulty in accessing property, the generation of households used to have considerable facilities to achieve this. Your access to the different properties is inseparable from a very specific historical context. Baby boomer households benefited from housing policies (first through deferred and subsidized access; then through the tax deduction for the purchase of a main residence), as well as from an expanding mortgage market. and the spiral of price increases linked to marketing. housing.
Thus, these households were able to access property from the start of their residential career, paying their mortgages and concentrating numerous real estate assets. This combination of circumstances has proven to be very effective since the crisis that began in 2008. Some of these households have expanded their assets by acquiring housing devalued by the bursting of the bubble, favored by a decade of low interest rates and for most of them indifferent to the job market. and credit restrictions that have excluded younger generations. With major international financial players, these households have accumulated real estate assets capable of generating, in certain cases, rental income. And this rentier position benefited from favorable political conditions. Thus, in Spain, the percentage of owners increased from 2% in 2002 to almost 7% in 2020, while the percentage of renters increased from 13% to 20%.
The concentration of real estate wealth in the hands of certain mature households not only enriches them, but at the same time makes younger generations dependent on them. The differences in the wealth accumulated from an early age between the two generations are eloquent and are the basis of recurring calls for generational conflict. People between 30 and 40 years old accumulate around 30,000 euros in assets, while at the same age, their parents already owned more than 100,000 euros, not counting mortgage debts which few young people can now access: more than 50% of households under 35 years old. of age had debts linked to the main residence in 2002, while in 2022 this figure barely exceeds 20%, according to the Bank of Spain.
A machine to produce inequalities
In this context, mothers and fathers who can help their children with the resources they have obtained through the same process that excludes them from independent access to housing. We therefore observe intense strategies of intergenerational support, and not conflict. But not all members of the two generations had a homogeneous experience. Above all, certain social classes of baby boomers can leave their real estate wealth to their descendants (mom and dad’s bank), while others cannot. Intergenerational inequalities thus widen intragenerational inequalities. On the one hand, the middle and upper classes of the baby boom have been favored to acquire real estate wealth which shelters them from the risks of the present. On the other hand, these same classes offer support and transfer wealth to their descendants to save them from the rental market, to which those who do not benefit from such support are condemned. The data is clear: more than 50% of the profits from rental income benefit the richest 20% of the population; while the poorest 20% of tenants spend 45% of their income on paying rent. It is not so much a generational war as class wars.
Renters with children (many immigrants) cannot use their home as a resource for their children or guarantee their mortgage.
Even though access to property has spread socially among the baby boom generation, the upper middle classes have benefited more from rising prices than the working classes, who have obtained lower profits and have been more vulnerable to economic volatility, as well as mortgage risks (and, with them, evictions). Likewise, many working-class families were excluded from home ownership. In such cases, tenants with children cannot use their home as a resource for their children, nor can they guarantee their mortgage. The majority of households with an immigrant background find themselves in this situation. Rather, mortgage and financial products allow homeowners to extract wealth from their homes and pass it on through gifts or anticipated inheritances to their descendants. This is the reason for so many tax exemption policies on donations, property and inheritances, a real key to the political production of social inequalities in Spain, with Madrid at the helm. Around 2040 the great succession should begin: the inheritance of wealth from the baby boom generation. But it will be very unequal: the richest 10% concentrate 56.6% of the country’s wealth. Furthermore, a recent study carried out in Barcelona reveals that seven out of ten tenants do not plan to inherit a home in the future4. In total, inheritances and/or donations are 60 times higher among the richest 20% of households than among the poorest 20%.
In short, the real estate situation of mature generations is consolidated as a central dimension of the reproduction of inequalities. As a result, transitions to adult life face a bifurcation between those who benefit from housing support and those who do not, with consequences for decisions such as emancipation, motherhood or job training. ‘a couple, so many areas where privileges are also inherited from reality. succession-family lineage. In all cases, freedom requires material supports. This set of social dynamics warns of the consequences of attachment to property, which functions in practice as a means of social discipline and economic domination. After the erosion of the myth of meritocracy, it is the turn of the false promise of property.
