Young Britons squeezed out of owning homes as low rates drive up UK house prices
Brits in their 20s are half as likely as the previous generation to own their own home, a study from the Institute for Fiscal Studies showed yesterday, as low interest rates and a lack of construction have driven up prices.
Only 20 per cent of 25-year-olds own their home now, compared with 45 per cent 20 years ago, the study found.
Home ownership is increasingly rare in London – the IFS found 60 per cent of Britons own a property, compared with 44 per cent of those living in the capital.
Meanwhile, a study from Akzo Nobel found 54 per cent of adults believed expensive housing was the biggest challenge for future generations.
The trend to falling ownership levels has been going on for several decades before the recent spike in prices. The ownership rate for 35-year-olds in the cohort born in the mid-1970s was 10 percentage points below the rate for those born a decade earlier, the IFS said.
“There is also evidence of divergence in housing characteristics between generations,” said the report, written by Chris Belfield, Daniel Chandler and Robert Joyce. “Couples aged 60 and over saw an 11 per cent increase in floor space per person between 1996 and 2012. Meanwhile, for most working-age household types, floor space per person was flat or falling.”
However, the IFS also noted the low interest rate era had meant housing costs were relatively affordable for those who had managed to get on to the property ladder.