Young adults with middle incomes are now the least likely to own property
Young adults today are significantly less likely to own property than those born just a few years earlier, according to a new report.
Findings by the Institute for Fiscal Studies suggest that those between 25 and 34 with incomes in the middle 20 per cent for their age (£22,200 to £30,600 annually) have seen the opportunity to buy their own home disappear.
Homeownership rates plummet every decade
Thanks to rising house prices and high living costs, it comes as no surprise that young people are struggling to purchase property, but the statistics are eye opening.
At the age of 27, those born in the late 1980s had a homeownership rate of 25 per cent.
Just five years earlier (in the early 1980s), 33 per cent owned property, and 43 per cent were in a position to purchase a home in the late 1970s.
House prices go up - but wages stay the same
A sharp rise in house prices relative to incomes is the key cause for this change in house-buying habits.
Taking inflation into account, mean house prices were 152 per cent higher in 2015 and 2016 than in 1995 and 1996.
By contrast, the real net household incomes of those aged 25 to 34 increased by only 22 per cent over the same period.
With a national average deposit requirement of close to £26,000, it is looking increasingly likely that individuals will be middle aged before they are in a position to buy a home.