Nationwide reports that the latest English Housing Survey from the Department for Communities and Local Government revealed a further decline in home ownership rate to 62.90% in 2016 – the lowest recorded since 1985.
Over the past decade there has been a particularly marked decline in the home ownership rate amongst young adults (those aged 25-34) traditionally the segment containing most first time buyers.
While the last two years have seen a slight improvement in the proportion of young adults owning their own home (currently 38%), this remains considerably lower than was the case ten years ago. The data also reveals a significant fall in home ownership rates among those aged 35-44 to just 56% (down from 74% in 2006).
The counterpart to this trend has been robust growth in the Private Rented Sector, with 20% of households in England now privately rented, a record high, up from 12% ten years ago. The number of privately rented households has increased by more than 75% over the past decade and now stands at 4.5 million.
Unsurprisingly, those in the younger age groups are most likely to rent, but interestingly strongest increases, in terms of the numbers of households renting, have been amongst those aged 45-54 and 55-64. Over the past ten years, the number of privately rented households in the 45-54 age group has nearly tripled to 700,000.
The report concludes that it is unclear what is driving the increase in private renting amongst older households. However, it is interesting to note that these age groups have also seen a decline in the proportion of people owning their home outright. This suggests a growing divide between property ‘haves’ and ‘have nots’.