Research by the think-tank published today measured levels of home ownership across the country. It revealed that far from being a London-centric problem, many regions in England are also now experiencing a significant drop in home ownership.
The report, which based on Office of National Statistics’ Labour Force Survey data, indicates home ownership peaked in the early 2000s at around 71% of the population. This figure has plummeted in the intervening years and now stands at 63.8% – the same as in 1986.
At that time, a first-time buyer spent around £30,000 on a new home. In 2015, the average figure was more than £150,000. This is likely to compound fears that home-owning is an increasingly distant dream for many people, the review stated.
In London, the average first-time buyer spends £330,000 on a house, which the report said helps to explain why only a third of households own homes in the capital.
However, it is Greater Manchester that has seen the largest dip in homeowners – 14%, since the peak levels of the early 2000s. Only 60% of households in the region own their home, which puts it on a par with London’s suburbs.
A similar story has been reported in Sheffield, Leeds and the West Midlands metropolitan area, which have all experienced a drop of more than 10%.
The main consequence of this trend is the increase in private renting. Across England, the proportion of people renting privately has nearly doubled between 2003 and 2015. In Greater Manchester, this figure almost tripled. On average, private renting accounts for around 30% of income, compared to 23% in the case of mortgage repayments.
According to the report, only Germany now has a lower level of home ownership than Britain in Western Europe.
However, this does not mean that the appetite to own a home has diminished. The report highlighted a government review that found only 3% of respondents said they prefer the flexibility of renting to owning a home, and less then 1 in 10 said they are unlikely to ever own a home because they were happy where they were.
