London: The widely-held English dream of buying your own home is under threat as rising costs have pushed ownership to the lowest level for 30 years, a new study revealed on Tuesday.
More and more people are now forced to rent in the private sector, which is more expensive than a mortgage and can often be insecure, the Resolution Foundation said.
Research by the think tank found home ownership in England fell to 63.8 per cent in February, a level last seen in 1986 and down from a peak of 70.8 per cent in 2003.
It is now lower than any other country in western Europe barring Germany, foundation analyst Stephen Clarke said, with affordability cited as the biggest barrier.
The average first-time buyer paid just under £30,000 for their new home in 1986, compared to £150,000 ($198,500, Dh733,815) now — and earnings have failed to keep pace.
“This matters not just because of the frustration it brings for those unable to buy, but because of its impact on living standards, too,” Clarke wrote in a blog post.
“Housing costs have accounted for an increasing share of household income over recent decades.”
Property ownership has become something of a British national obsession since the 1980s, when then prime minister Margaret Thatcher allowed social housing tenants to buy their homes from the state at a reduced rate.
The government’s English Housing Survey report last month found that only one in ten renters said they preferred their current situation to buying — most were simply priced out.
Ministers have sought to help first-time buyers with a scheme that effectively lends them money for a deposit. Interest rates are also at a record low.
But the percentage of people renting in the private sector — as opposed to the low-cost social sector — is up from 11 per cent in 2003 to 19 per cent in 2015.
Private rent accounts on average 30 per cent of income, while mortgages account for 23 per cent, the foundation says.
A study last month by Deloitte found Britain has the least affordable housing in Europe.
Britons need to save almost 11 years to buy a new apartment, compared to 3.3 years in Germany and six to eight years in Ireland, Italy, Hungary, France and Poland.