For The First Time in a Decade Home Ownership for the Young Has Increased
According to the English Housing Survey conducted by the government around 41% of people aged between 25 and 34 owned their own home in 2018/2019.
Although this is great news that this has increased from the low of just 36% in 2013/2014, the decline from the previous decade was from the heights of 59% in 2003/2004. The recent increase however bucked the overall trend for home ownership, with rates across all age groups remaining static for the sixth year in a row.
Conversely the number of households in the private rental sector, although remained unchanged from the previous year at 4.6 million or 19%, has doubled since 2002.
The increase in home ownership rates among young people is likely to be down to a number of factors. The number of government schemes available to first-time buyers will definitely have helped.
For example the Help to Buy scheme which enables people to purchase a new build property with just a 5% deposit, is available to anyone and statistics reveal that 81% of people who have used the scheme since its launch have been first-time buyers.
The fact that the number of people renting privately has grown significantly in size in recent years, suggests that this sector is absorbing the majority of people who are unable or unwilling to buy their own home.
While it is great news that more young people are able to buy a property, the survey also flagged up a fall in home ownership rates among older age groups.
Those aged between 35 and 44 were still most likely to be owner-occupiers at 55%, but the proportion who rent from the private sector has risen from 16% in 2008/2009 to 29% in the most recent survey.
There has also been an increase in people aged 55 to 64 living in rental accommodation, with 10% renting privately, up from 7% in 2008/2009, while 17% are in the social rental sector, compared with 14% 10 years ago.
Despite the increase in home ownership rates among young people, the survey showed that overall owner occupation rates remained unchanged for the sixth year in a row at an estimated 15 million households, or 64%.
The proportion of people who lived in their own home increased steadily from the 1980s to 2003, when it reached a peak of 71%, before gradually declining to its current level.
The stagnation in home ownership rates is likely to have been caused by a combination of tougher mortgage affordability criteria following the financial crisis, and stretched affordability as a result of house prices rising faster than earnings in recent years.
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