Inheritance: the enemy of equality

Britain is supposed to be a meritocratic society,
said Ian Jack. But whether you wind up rich or
poor will increasingly depend on a single factor:
inheritance. Today, the average inheritance is worth
just 3 percent of all the other income the inheritor
can expect to get in a lifetime. But that percentage
is set to shoot up, thanks to the soaring rise in
real estate prices in recent decades. The housing
bubble means the older generation now sits on a
vast stock of wealth. Britons 65 to 85 years old
today own some $517 billion worth of property,
according to a new study. Most of them will pass
the proceeds on to their children or grandchildren,
who will invest in more property. That’s great for
those who inherit, but it will have a dire impact on
inequality, deepening the gulf between the propertied
classes and those for whom owner-occupation
is an ever more distant dream. Renters accounted
for 9 percent of the housing market in 1985—now
they account for more than 20 percent. “We are reentering
the world of the Victorian novel, in which
suitable marriages, contested wills, and misplaced
legacies drive the plot.” The poor, meanwhile,
“press their faces against the window.”