Homeownership among young Britons plunges compared with 20 years ago

The rate of homeownership among young, middle-income adults in Britain has more than halved over the last 20 years, according to research that highlights growing generational strains in British society. Only 27 percent of Britons aged between 25 and 34 with incomes in the middle bracket for their age owned a home in 2015/16, down from 65 percent in 1995/96, the Institute for Fiscal Studies (IFS) think tank said on Friday.
Housing costs are a common concern in Britain, especially for younger workers in expensive areas such as London and much of southern England. The IFS has previously warned that wealth is likely to become more concentrated in the hands of older Britons, as young people struggle to buy homes, while having to pay more towards pensions and bearing the brunt of weak wage growth since the financial crisis.
In November British Prime Minister Theresa May scrapped property purchase taxes for almost all first-time buyers in a bid to win over younger voters who are unable to buy a home. That followed the Help to Buy scheme introduced in 2013, which widened access to mortgage finance for first-time buyers unable to pay large deposits. However, critics say more house-building is needed to slow the pace of price rises.
The IFS said that for 90 percent of 25-34 year-olds, average house prices were more than four times their after-tax income, while this was true for under half of 25-34 year-olds in the mid 1990s. This reflected much faster growth in house prices than in wages over that period. Young people whose incomes allowed them to buy a house were just as likely to as 20 years ago, the IFS added.
The IFS defined a middle income household as one with an after-tax income of 22,200-30,600 pounds ($31,217-$43,029), which would place them in the middle 20 percent of the income distribution for their age group.