Home ownership and asset-based welfare

In recent decades, the notion of an ‘asset-based’ or ‘property-based’ welfare system has become increasingly central to debates on the restructuring of western welfare states (Groves et al. 2007; Regan and Paxton 2001; Sherraden 2003; Watson 2009). The principle underlying an asset-based approach to welfare is that, rather than relying on state-managed social transfers to counter the risks of poverty, individuals accept greater responsibility for their own welfare needs by investing in financial products and property assets which augment in value over time. These can, at least in theory, later be tapped to supplement consumption and welfare needs when income is reduced, for example, in retirement, or used to acquire other forms of investment such as educational qualifications. Several socioeconomic developments have helped to advance the cause of asset-based welfare. On one side has been a combination of pressures brought on by the ageing of national populations and their expected impact on pensions and public welfare resources, along with government retrenchment of public welfare provision associated with neoliberalisation. On the other has been, until very recently at least, expanding home ownership rates and increases in housing property values across most economically advanced economies. Essentially, the potential wealth tied up in owner-occupied housing has been considered, more or less explicitly, to be a solution to the fiscal difficulties involved in the maintenance of welfare commitments, and through that, the asset in asset-based welfare has frequently become property or housing asset (Doling and Ford 2007).