Younger Tenants Dominate the Rental Market

Buying their own home is becoming an ever more distant dream for young working households on modest incomes a think tank is claiming. Home ownership is projected to be just 1 in 10 by 2025 according to the independent Resolution Foundation body.

The biggest decline in home ownership is amongst those on modest incomes but it has also fallen amongst those on higher incomes. Home ownership is becoming the preserve of older and wealthier households.

The analysis found that the over 65’s now account for a third of all homeowners – up from a quarter in 1998. Those aged 16-24 account for just 10% of homeowners, down from 19% in 1998. Home ownership among the under 35’s has plummeted from 57% in 1998 to just 25% and levels of private renting have more than doubled over the same period.

“With the average modest income household having to spend 22 years to raise the money needed for a typical first time buyer deposit – up from just three years in the mid 1990’s – it’s no surprise that owning is increasingly a pipe dream for many” says Matt Whittacker, chief economist at the Resolution Foundation. He continues “Schemes such as Help to Buy can only ever help a minority – often providing a leg up to those who would eventually climb onto the housing ladder anyway. More than half of those benefiting from Help to Buy to date have household incomes in excess of £40,000. It is hard to imagine any way out of the home ownership crisis facing those on low to middle incomes that doesn’t involve significantly boosting house building.”

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