Home ownership becoming a 'distant dream' for young people

Many young people can't afford to take their first steps onto the property ladder. Pic: PA.
Many young people can't afford to take their first steps onto the property ladder. Pic: PA.

Home ownership is becoming a "distant dream" for millions of young people, an advisory group has warned.

Those on lower incomes are finding it almost impossible to get on the housing ladder, according to the Social Mobility Commission.

The Government advisory body found that more than a third (34%) of first-time buyers now turn to their family to help them buy a home, compared with one in five (20%) seven years ago.

A further one in 10 rely on inherited wealth, the analysis of government and housing market data by Cambridge University and Anglia Ruskin University researchers found.

Home ownership has fallen among 25-29 year-olds by more than half in the last 25 years, from 63% in 1990 to 31% most recently, the report said.

Former Labour cabinet minister Alan Milburn, who chairs the commission, said: "Home ownership helps unlock high levels of social mobility, but it is in free-fall among young families.

"Owning a home is becoming a distant dream for millions of young people on low incomes who do not have the luxury of relying on 'the bank of mum and dad' to give them a foot up on the housing ladder.

"The way the housing market is operating is exacerbating inequality and impeding social mobility.

"It is welcome that the Government recognises the growing problem people face in getting on the housing ladder.

"A major national effort is needed to expand opportunities for home ownership, and will require more radical action on housing supply."

The researchers found that around a third (30%) of UK households with dependent children currently have assets which could be used towards a deposit for a home.

But the figure drops to 10% for households with no formal educational qualifications over two successive generations.

The report's lead author, Dr Paul Sanderson, said: "Going forward, the gap is likely to continue between those in the UK who can acquire that most significant of financial assets, the family home, and those who cannot.

"Only better-off young people and those who have parents who have already accumulated housing wealth are likely to be able to consider home ownership without radical changes to the housing market."