High property prices and a lack of affordable homes continues to lock many would-be buyers out of the property market leaving them with no alternative but to live in rented accommodation.
The long-term decline of homeownership levels owed largely to rising property prices stoked by a widening supply-demand imbalance and the deregulation of the mortgage-lending business means that over a quarter of the adult population (28%) are now living in private or social rented property, according to research from landlord insurance specialists Cover4LetProperty.
Interestingly, although a recent report from Shelter found that younger generations are giving up hope of ever owning a home because property prices have become unaffordable, the study by Cover4LetProperty revealed that a high share - 57% - of those aged 60-plus also live in rented property.
The most prolific renters (67%) are in the income band £10,000-£19,999, with double the amount of women (40%) living in rented accommodation compared to men (20%).
A report last year from accountancy firm PwC suggested that the volume of new homebuyers is set to carry on falling over the next 10 years, as they struggle to raise the high deposit needed to buy property.
With fewer people qualifying for social housing, the study said that within the next decade more than half of those under 40 are likely to be living in properties owned by private landlords.
By 2025, PwC predicts that 7.2m households will be in rented accommodation, compared with 5.4m today and just 2.3m in 2001.
The report underlines the growing divide between those who can get on to the housing ladder and those who are unable to raise the funds to buy. “House purchases have historically been a major factor in driving wealth accumulation of lower and middle classes,” it said. “The inability of many to get on the ladder may limit this avenue to social mobility in the future.”
Reflecting on the report, John Hawksworth, chief economist at PwC, commented: “A large and sustained increase in affordable housing supply will be required to meet the needs of a UK population that is growing relatively rapidly by European standards.”