Home ownership falls to 30-year low, says Resolution Foundation

Home ownership in England has fallen to the lowest level since 1986, particularly in Manchester and the Midlands, as it becomes increasingly unaffordable, according to a think-tank.

Resolution Foundation said English home ownership fell by 14.5% to 58% this year from its peak in 2003. In the West Midlands it fell 11.2% to 60% this year from its peak in 2003.

London, also recorded double digit falls as it decreased by 13.5% in outer London to 58% this year from its peak in 2000.

The foundation said that London was not the only city experiencing a housing crisis.

Resolution Foundation policy analyst Stephen Clarke, said: “London has a well-known and fully-blown housing crisis, but the struggle to buy a home is just as big a problem in cities across the North of England.

“The chances of owning a home have fallen fastest in Greater Manchester over the last decade, though the Leeds and Sheffield city areas have also experienced sharp drops.”

In the UK, home ownership fell 6.8% to 64% home ownership, in England it decreased 7% to 64%, Scotland dropped 6% to 64%, Wales declined 5% to 70% and Northern Ireland slid 10.5% to 63%.

The foundation, which used data from the Office for National Statistics’ Labour Force Survey, found that in the 1980s the average first-time buyer paid under £30,000 for a house, in comparison to the average £150,000 today.

As home ownership fell, renting from private landlords increased to 19% in 2015 from 11% in 2003. In Greater Manchester it rose sharply to over 20% from 6%.

Renters spend most of their income (30%) on housing than people who own (23%). The foundation also highlighted the insecurities of renting short-term and the struggle to accumulate wealth that they may need later in life while paying rent.

Clarke said: “These drops are more than a simple source of frustration for the millions of people who aspire to own their home. The shift to renting privately can reduce current living standards and future wealth, with implications for individuals and the state.

“We cannot allow other cities to edge towards the kind of housing crisis that London has been saddled with.

Clarke said he was encouraged by the Prime Minister’s intentions when Theresa May said she would tackle the housing deficit.

“It’s encouraging that the new prime minister has talked about tackling the housing deficit. She may find that making good on this promise could secure as important a legacy as negotiating a successful exit from the European Union.”

In her maiden speech as Prime Minister, May said it was an injustice that “if you’re young, you’ll find it harder than ever before to own your own home”.