Housing costs have trebled in the last 50 years
In fact, housing costs have trebled in the last 50 years, with younger people having to compromise with longer commutes and smaller, insecure rented accommodation.
The report by leading think tank, Resolution Foundation, found that each generation since the war has had to spend more of their income on housing.
The pre-war generation (1926-1945) spent just 7% of their income on housing at the age of 30. This figure more than doubled for baby boomers (1946-1965), who spent 17% of their income on housing at that age. There’s also bad news for millennials (1981-2000) who currently spend almost a quarter of their income on housing (23%) at age 30.
The baby boomer generation has been the biggest beneficiary of the housing market boom, with those born in the late 1940s enjoying the highest ownership rates. The think tank stated that people born in each five-year period later have all done worse than their predecessors. Home ownership rates among young families born in the early 1980s are now around half that of those born 30 years earlier at the same age.
Further, the report found there are now as many young families (aged 25-34) living in the private rented sector as owning a home or living in the social rented sector combined (36%). Not only are younger generations paying more for housing, they’re paying more for less as the average floor space has fallen by 4% since 1996 for people aged under 45, while it increased by 2% for those aged 45 and over.
Young people today are also compromising on location, with millennials set to spend an extra 64 hours a year commuting to work by the age of 40 compared to baby boomers.
Even in an optimistic scenario in which home ownership for young people catches up with previous generations, the think tank estimates that most families may not be able to get onto the housing ladder until their 40s – a decade later than most baby boomers.
This means many more first-time parents will be living in private rented accommodation, juggling saving for a deposit with childcare costs.
‘Millennials are truly at the sharp end’
Lindsay Judge, senior policy analyst at the Resolution Foundation, said: “Across the generations, many are worried about why today’s young adults have it so hard when finding a secure place to live.
“Britain’s housing catastrophe has been 50 years in the making but while its effects are widespread it is millennials who are truly at the sharp end. For older generations at least rising housing costs have been accompanied by improvements in the quality and security of housing, as more families have been able to own their home.
“The big danger today is that young people are having to settle for lower quality, longer commutes and less security in order to afford a place to live, despite spending a record share of their income of housing.
“It is vital that all political leaders recognise the scale of Britain’s housing crisis which is placing an ever greater strain on families’ living standards, so that their response is suitably radical.”