Home ownership among young adults has 'collapsed', figures show

Average house prices were 152 per cent higher in 2015/16 than they were 20 years earlier after adjusting for inflation, the report said.

By contrast, the real net family incomes of those aged 25-34 have increased by only 22 per cent over the same period.

At 27 per cent, the home ownership rate of middle-income young adults in Britain is now closer to those with low incomes than it is to those on high incomes, the IFS found.

In 2015/16, 8 per cent of young adults on low incomes were home-owners compared with 64 per cent of those with high incomes.

Twenty years ago, middle-income young adults had home ownership rates much more similar to high-income young adults, the IFS said.

Young adults today are much less likely to be home-owners than those born just five or 10 years earlier, the report found.

The IFS said 25 per cent of those born in the late 1980s owned their own home at the age of 27, compared with 33 per cent of those born in the early 1980s and 43 per cent of those born in the late 1970s.

For nearly 90 per cent of 25 to 34-year-olds, average house prices in their region are more than four times their annual after-tax family income - and for nearly 40 per cent house prices are more than 10 times their income.

Young adults from more advantaged backgrounds are significantly more likely to own their own home, the IFS said.

Between 2014 and 2017, 30 per cent of 25 to 34-year-olds whose parents were in jobs classed as "low-skilled", such as delivery drivers or sales assistants, owned their own home, compared with 43 per cent of those whose parents were in "higher-skilled" occupations, such as lawyers or teachers.

Housing minister Dominic Raab MP said: "Through schemes like Help to Buy, we're helping more people onto the housing ladder and last year saw the highest number of first-time buyers in the UK since 2006.

"But we want to go further and faster and our ambitious plan backed by targeted investment will help even more people by delivering the homes Britain needs for young families, key workers and those on low and middle incomes".