Home ownership halved among 25-year-olds over last 20 years
A new report has found that the number of 25 year olds who own their home has more than halved in the last two decades.
New analysis for the Local Government Association (LGA) reveals 46% of all 25 year olds owned their home 20 years ago - but only 20% of 25 year olds are on the housing ladder today.
The LGA, which represents more than 370 councils in England and Wales, said more homes for affordable or social rent are needed to allow people to save up for a deposit and get on the housing ladder.
The report highlights the growing divide between homeowners and people forced to remain in increasingly unaffordable rental accommodation.
In addition, the research shows that on average, private renters now pay 34% of their total household income on rent and social and affordable renters pay 29%. In comparison, homeowners pay an average of 18% of their total household income on their mortgage.
But the average size of a deposit to get a mortgage is 62% of annual incomes, or 131% in London.
Record low interest rates have helped to keep repayments low for those already on the ladder but have served to keep prices buoyant, pricing out those seeking to buy their first home. Average house prices are now 7.9 times average earnings, the report said.
The LGA’s housing spokesman, Cllr Martin Tett, said: “Our figures show just how wide the generational home ownership gap is in this country. A shortage of houses is a top concern for people as homes are too often unavailable, unaffordable and not appropriate for the different needs in our communities.
“The housing crisis is complex and is forcing difficult choices on families, distorting places, and hampering growth. But there is a huge opportunity, as investment in building the right homes in the right places has massive wider benefits for people and places.”
The LGA has set out over 30 recommendations for central government including freeing councils from restrictions on their borrowing to build more affordable homes, giving local authorities powers making it easier to compulsory purchase land that has planning permission for homes but which is not being built out, and allowing councils to set planning fees locally.
Land & Development
Time FM Shows
New Build Developments
Get excited about 2017