Jump in adults priced out of flying the nest
SOARING rents and large deposits are making it increasingly difficult for young people to buy a home, industry data showed yesterday.
Figures from the Office for National Statistics (ONS) recorded a 20 per cent jump in the number of young adults living with their parents since 1997, while figures from Rightmove showed that 30 per cent of tenants spend more than half of their take-home pay on rent.
Nearly 3m adults aged between 20 and 34 lived with their parents last year, according to the ONS – up almost half a million, or 20 per cent, since 1997, even though the number of people in that age bracket is largely unchanged.
That is made up of 1.8m men, or one in three in the age group, and 1.1m women, or one in six.
The ONS says that difference has arisen because women are more likely to live with an older man, more likely to look after the children when a relationship breaks down, and more likely to participate in higher education, moving away from the parental home.
House prices are thought to have driven the overall rise – the average property price rose 40 per cent over the period.
Meanwhile Rightmove’s rental market survey showed rents soaring, making it increasingly difficult for young adults to save for a deposit.
The average tenant pays 38 per cent of their take-home pay in rent, while 30 per cent pay over half of their income, making it more difficult to save for a deposit or mortgage.
The most recent English Housing survey shows 14 per cent of 16 to 24-year olds owned their home in 2009-10, down from 36 per cent in 1991.
Similarly 47 per cent of 25-34 year olds are homeowners, down from 67 per cent in 1991 – a situation which lenders suspect has got worse even since 2010.
“Raising a deposit is a key barrier for young people wanting to buy a home,” said Paul Broadhead from the Building Societies Association.
“For those living and working in London the cost of renting makes it doubly difficult to rent and save to buy at the same time.”
GENERATION RENT: IN NUMBERS
23.6 per cent of 18 to 34 year olds live with one or both parents
That is a total of almost 3m young adults – up 500,000 since 1997
House prices have risen roughly 40 per cent over the same period
1.8m men in the age group, or 29 per cent, live with their parents, compared with 1.1m women, or 18 per cent
As London sees an unusual level of inward migration, only 19.7 per cent of 18 to 34 year olds live with their parents
The average tenant now pays 38 per cent of their income on rent
30 per cent pay over half their take-home income on rent
56 per cent of renters would like to buy but cannot afford to
61 per cent expect rents will rise over the next 12 months
Pressures in the market are pointing this way – Rightmove has seen rental search activity rise 43 per cent in the last year while supply has only risen by three per cent