Home ownership in the UK is at its lowest level for 30 years – falling to just 63.3 per cent and helping landlords to secure permanent tenants
The latest annual report from the Department of Communities and Local Government shows home ownership fell by 1.9 per cent in 2013/2014.
The rate of home ownership has fallen steadily since 2003 and is now eight per cent lower than the all time high of 70.9 per cent experienced 12 years ago.
A sharp decline in the number of young people owning a property was noted, particularly among those aged between 25 and 34 years.
This group is traditionally seen as vital to the housing market but home ownership among them has fallen from 59 per cent in 2004 to 36 per cent last year.
In that period, the proportion of people 25-34-year-olds renting increased from 41 per cent to 64 per cent and was even higher for those aged 16 to 24 years with 91 per cent of people in this age group renting properties in 2014 compared to just 76 per cent a decade earlier.
Landlords take biggest share of market since 60s
This means the private rental sector now houses 19 per cent of all households in England; its highest share since the 1960s.
Since 2004, the number of privately rented properties has nearly doubled to 4.4 million but 61% of those in the sector expect to purchase a property in the future. (Private rented sector housing exceeds £1 trillion)
However, 50 per cent of renters expect it to take at least five years before they can enter the housing market as a buyer.
Lucian Cook, Head of Residential Research at Savills, suggested that the figures highlight the gap between the generational divide and the need for “a co-ordinated, long term response”.
“A new government will need to front up to the need to provide a bigger, better private rented sector and find ways to encourage the recycling of existing housing wealth so younger households can get on and trade up the housing ladder,” he said.
Savills has predicted that the number of private rented properties will continue to rise and suggests that there could be more than six million private rented households by the end of 2019.
In London, the firm estimates that an additional 250,000 households will be privately rented by 2019 – meaning that 36 per cent of property in the capital will be lived in by tenants rather than homeowners.