Young adults with middle incomes are considerably less likely to own their own home than those born 20 years earlier, new figures show.
Research by the Institute for Fiscal Studies (IFS) found that from 1995/96, 65% of 25 to 34-year-olds with incomes in the middle 20% for their age group owned their own home.
By 2015/16, this age group had fallen to only 27%.
This demographic experienced the sharpest decline, but home ownership fell for all young adults in the study.
A quarter of those born in the late 1980s owned a home at age 27, compared to 33% of those born in the early 1980s and 43% of those born in the late 1970s.
The IFS argues that this difference is down to the rise in house prices compared to largely stagnant income.
In 20 years, house prices increased by 152% while incomes only grew 22% over the same period.
Quote from Nigel Holland:
“It is of no surprise that the percentage of home owners ranging from the ages of 25 to 34 has dropped. As the prices fly up, so should the income of those paying for the house however this is not the case. The IFS said that “during 2015-16, 25 to 34 year olds were faced by an average regional house price of at least four times their income” resulting in a decrease in the amount of home owners. It hard for young adults to be able to find the capital to pay for a home when the cost of them is continuously and rapidly increasing, forcing them to stay at home and live with their family whilst trying to find the capital.”
https://www.hollandandcompany.co.uk/