Homeownership levels 'collapsing among young and low-income Brits'

by Gary Whittaker

Homeownership levels are "collapsing" among the UK's young people and those with low incomes. 

This is according to the Chartered Institute of Housing (CIH), which has claimed these groups are "paying the price" for the country's "broken housing market".

A new report from the organisation revealed homeownership is falling among young people, but rising for their older counterparts. 

In England, 36 per cent of 25 to 34-year-olds currently own their home, which is down from more than two-thirds in 1991. However, the number of homeowners aged between 65 and 74 has risen from 62.3 per cent to 77.1 per cent in the same period. 

The CIH said net housing wealth has grown by 58 per cent (£1.22 trillion) since 2003, with more than a third of this held by households where the reference person is 65 or older. It claimed this concentration of wealth has fuelled the growth of the buy-to-let market, with older people looking to boost their wealth by buying more property. 

According to the organisation, this has created a "perfect storm" with homeowners buying up properties to rent out to people who are unable to compete in the housing market. It pointed to the fact that close to half (48 per cent) of 25 to 34-year-olds live in rented accommodation - up from just 21 per cent in 2003-04 - as evidence of this. 

The CIH claimed a further 1.5 million under-30s will have entered the rental sector by 2020.

Its interim chief executive Gavin Smart stated: "For decades, we have failed to build enough new homes to keep up with our growing population, and the gap between the haves and have-nots is getting bigger all the time.  For many young people, a home of their own is a distant dream."

The CIH has called for "coordinated, sustained action" over at least ten years to ensure this problem is solved. 

"Making housing more affordable means building more homes of all tenures - for ownership, shared ownership, private rent and social rent," Mr Smart added.

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12-March-15General Lettings News