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Homeownership at 30-year low

Christina Hoghton
Written By:
Christina Hoghton
Posted:
Updated:
02/08/2016

Manchester has seen the steepest drop in levels of homeownership in the last decade

Homeownership across English cities has plummeted to its lowest level in 30 years, and Manchester is the city hit hardest over the last decade, according to new research from the Resolution Foundation.

The think-tank said that since homeownership peaked at 71% in 2003, the proportion of people owning a home across England has fallen by 8%.

Falling fast in Manchester

Of the proportion of households in Greater Manchester in 2003, 72% were homeowners, just above the UK average. However, this has since plummeted by 14% with just 58% of Manchester residents owning their home, falling by almost double the rate witnessed in England.

A growing trend of would-be homeowners struggling to raise funds for a deposit has played a major role in this depreciation, the Resolution Foundation said.

Homeownership now stands at 64% across the UK as a whole, with Northern Ireland experiencing the sharpest drop of 10.5% since reaching its highest point in November 2006. Meanwhile, the proportion of homeowners in England has fallen by 7% and 6% and 5% in Scotland and Wales, respectively.

Renting rising

At the same time as homeownership plunged across England, the number of private renters has almost doubled from 11% in 2003, to 19% in 2015. Once again, the picture in Manchester is more dramatic, with the proportion of households renting privately increasing from 6% to 20%, with Outer London and West Yorkshire also reporting double digit growth.

The think-tank noted that the shift from homeownership to private renting was a concern, particularly among young people, with private renters spending an average of 30% of their income on rent, compared to 23% for homeowners.

Stephen Clarke, policy analyst at the Resolution Foundation said a shift to renting privately across the UK could cause living standards and future wealth to suffer, with implications for individuals and the state.

“We cannot allow other cities to edge towards the kind of housing crisis that London has been saddled with. It’s encouraging that the new Prime Minister has talked about tackling the housing deficit. She may find that making good on this promise could secure as important a legacy as negotiating a successful exit from the European Union.”