Home ownership among young people rises after decade of decline

Home ownership among young people rises after decade of decline

Help-to-buy scheme has helped 25- to 34-year-olds get on property ladder, say analysts

Joanna Partridge The Guardian

Thu 23 Jan 2020 18.12 GMT Last modified on Thu 23 Jan 2020 19.35 GMT

The proportion of 25- to 34-year-olds who own their own home in England has increased for the first time in over a decade, according to official figures.

The latest English Housing Survey found that 41% of people in the age bracket live in a home they own, with the same proportion living in private rented accommodation. This is the reversal of the trend seen in the decade after 2003-04, during which the number of young owner occupiers fell from 59% to 36%.
the annual report from the Office for National Statistics found that the overall number of homeowners remained the same for the past six years. Home ownership peaked at 71% in 2003 and has steadily declined to 64% since then, which equates to 15m owner-occupier households of an estimated total of 23.5m.

Housing analysts said the government’s help-to-buy scheme, which launched in 2013 and gave financial support to homebuyers, had contributed to the increase in young people getting on the property ladder, along with stamp duty relief for some first-time buyers.

“Help-to-buy and stamp duty relief are behind the march of the first-time buyers, who will be powering a recovery in home ownership in this age bracket,” said Joseph Daniels, the founder of Project Etopia, which develops modular homes.

“Falling home ownership among the young still threatens to become a national crisis rooted in high property prices and stretched affordability but the tide has finally started to turn,” he said.

“It will take considerable time and momentum until owner occupancy among younger people returns to the 59% seen in 2003-04.”

Privately rented accommodation now accounts for 4.6m households, or 19%, which has remained unchanged for six years. But this sector is double the size it was in 2002.

The housing secretary, Robert Jenrick, welcomed the rise in the proportion of young people owning their home. However, the figures also showed an increase in overcrowding in the social rented sector, where people rent largely from councils or housing associations at a rate pegged to local incomes.

Overcrowding, which is measured by whether households have fewer bedrooms than notionally needed for its occupants, remains at its highest rate in the social rented sector, with 8% of that group living in overcrowded accommodation.

Polly Neate, the chief executive of the housing charity Shelter, said: “More and more families are crammed like sardines into homes that are too small for them because they can’t afford to rent anywhere bigger.

“The odds are stacked against struggling families. What this country desperately needs is an alternative to private renting, which is why Shelter is urging the government to build a new generation of genuinely affordable social homes.”