Five million people in the UK who want to live in their own home are having to rent instead, according to a report released today by the HomeOwners Alliance.
The organisation claims that UK homeownership is in long-term decline, having peaked 10 years ago, and is sliding to a point where a generation of young people face being locked out of the housing market.
Official figures show that the high point in homeownership in the UK was 2002, when 69.7% of households were owner-occupied. Since then the rate has fallen to 64.7%, a level last seen in 1988.
With house prices particularly high in London, the capital is the worst affected and the majority of households in London now rent. Just under half of properties in the city are owner-occupied – the lowest level since records began in 1991.
A variety of factors are behind the UK’s homeownership crisis, the report argues. The gap between house prices and what people actually earn is amongst the widest in the world, added to which mortgages remain out of reach for many people because lenders are asking for increasingly bigger deposits in order to help fund a house purchase.
The central problem is a chronic shortage of new homes, the HomeOwners Alliance believes.
Meanwhile, as more and more people are forced into renting, a separate survey out today shows that the cost of renting a home in England and Wales reached another new high in October.
LSL Property Services found that average monthly rents hit an all-time high of GBP744 last month, although the pace of rent rises has eased. After seven months of rent rises, rents are now 3.4% higher than they were at the same time last year.