Homeownership among under 35s hits highest level since 2010, IFS says - here's why
- Homeownership for young adults have recovered to 2010 levels
- 39% of 25 to 34-year-olds owned their home in 2022/23, up from 33% in 2015
- 69% of 45-59 year-olds own a home in 2022/23, down from 80% in early 2000s
Homeownership among young adults has risen to a level not seen since 2010, according to a new study by the Institute for Fiscal Studies (IFS).
It revealed in 2022/23, 39 per cent of 25 to 34-year-olds owned their home, which is up 6 percentage points from 33 per cent in 2015.
The IFS says there has been a partial recovery in homeownership for 25-34 year olds over the past decade.
Since 2015, there has been a partial recovery in homeownership for 25-34 year olds, rising by 6 percentage points to reach 39% by 2022–23
However, homeownership among the young remains some 20 percentage points lower than the peak seen in 2000 when 59 per cent of 25 to 34-year olds owned their home.
The recovery has been concentrated among those on middle incomes, according to the study and may be linked with the fact that disposable incomes of young adults have grown markedly faster since 2015 than the population as a whole.
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Jonathan Cribb, associate director at IFS, said: 'The collapse in homeownership among young adults has been central to policy concerns for a while: not surprisingly given that out of every 100 young people there were 20 fewer homeowners in 2022 than in 2000.
'But the recent trends are at least positive – with a gradual recovery for 25-34 year olds since 2015, potentially linked to better income growth over that period.
'In fact, we now see that all of the drop in home ownership for younger people effectively happened before 2010.
'Whilst it is middle-income young adults whose rates of homeownership have recovered most since 2015 they are still the group which has experienced the biggest fall since the early 2000s.
'This modest recovery occurred both before and after the pandemic. Whether rising mortgage interest will bring this trend to a halt, or indeed reverse it, remains to be seen.'
Despite the recent positive trend for younger people, it seems the opposite is true for those aged 45 to 59, despite 69 per cent being homeowners.
For these older working-age adults, gradual declines in homeownership have continued as generations of people have found it harder to get onto the housing ladder are reaching these ages.
Homeownership for those age group has fallen 7 percentage points since 2010 and is 11 percentage points below the early 2000s peak, according to the IFS.