A global report has revealed that home ownership levels are falling in many countries, with ownership in the United Kingdom dropping more sharply than most. The report suggests that this is a direct result of stretched affordability within the UK housing market as opposed to a general preference towards renting, similar to that which exists throughout Europe.
In 1918, immediately following the conclusion of the First World War, 77% of households in the UK were rented with the remaining 23 percent owned outright. The preference towards ownership of property increased rapidly between 1953 and 1971, by which time there was roughly an equal percentage of ownership and renting. Ownership reached its peak in 2001, at 69%, but has recently dropped to almost 60% in the last decade.
This is the first fall in the ownership of property since the beginning of the twentieth century. Stricter mortgage rules and increased investment from abroad, amongst other factors, mean that domestic buyers are being ‘priced out’ of the property market because it is often impossible to compete, which inevitably further increases the pressure on the government to create more affordable housing.
Plans are already in place to achieve this in London, and an announcement today has confirmed that enough unused land has been released across the whole country to accommodate over 100,000 new homes. Communities Secretary Eric Pickles stated that this even surpasses the original commitment set by the Prime Minister, and that the figure is set to rise again in the near future. A new target to release enough land with the capacity of 150,000 new homes between 2015 and 2020 has now been revealed, which is an extremely positive step towards reversing the decline in property ownership that currently exists, whilst concurrently increasing the power of domestic buyers.