Recent statistics reveal the extent of young people locked out of home ownership. The statistics made me think about the effect this has in the local rental market.
Central Somerset adults today are less likely to own their own their home than Central Somerset adults were at the start of the millennium. Turn back the clock to mid-2001 and in the charts S Club 7 were telling us not to stop movin and 64.2% of families owned their own home. By 2017 this had dropped to 56.8%
When we start looking at home ownership for different age groups, some more interesting trends are revealed.
Most notable is the fall in those families in the 25-34 age range who own their own home. Back in 2001 50.1% of families (singles or couples) in this age range owned their own home. By 2017 this had dropped to 28.4%. Go back another 10 years to 1990 and the figure was even higher at 55.6%
In fact, it was only the 65+ age group that have a higher percentage of homeownership today – rising from 72.9% at the end of the last millennium to 80.2% in 2017.
For the 25-34 age group nationwide, home ownership in 2017 is now less common than in the early 1960s. Whether those young people will ‘catch up’ in later life remains to be seen.
Depending who you talk to, the fall in homeownership amongst the 25-34 age range has been attributed to a number of factors including low levels of housebuilding, rising house prices, a resurgence of the private rented sector, lack of social housing and the financial crisis causing a decline in mortgage availability. I also believe the number of young people now going to university and entering the job market at an older age with a huge student loan is a significant factor.
What does the slump in young adult homeownership mean for landlords in Street and Glastonbury?
Only one thing .. with the local authority not building Council houses, housing associations strapped for cash to build new properties and the younger generation not buying, there is only one way these youngsters can obtain a roof over their head and have a home of their own .. through the private rental sector.
About Tom Morgan
Founder of Jungle Property the multi award-winning letting agent based in Glastonbury, Somerset. I am passionate about property and Glastonbury and about providing the very best advice to anyone who wants the best return on a buy-to-let property investment. For an open and brutally honest opinion on anything in the Glastonbury property market please contact me via tom.morgan@jungleproperty.co.uk
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