Falling U.K. home ownership rates mean a third of millennials will spend their lives in rented housing, according to a report by the Resolution Foundation.
Up to half of the generation will be renting — either privately or in the public housing sector — into their 40s, with a third still not owning a home by the time they claim their pensions, Resolution said in research published Tuesday. The think tank calculates such a pattern could see the U.K.’s housing benefit bill for pensioners double to 16 billion pounds ($23 billion) by 2060 from 6.3 billion pounds today.
The report showed that, at the age of 30, four in 10 millennials live in private rented accommodation, double the rate for the previous generation and four-times that of baby boomers. A record 1.8 million families with children also rent privately, up from 600,000 just 15 years ago, the report said.
“Britain’s housing problems have developed into a full-blown crisis over recent decades and young people are bearing the brunt — paying a record share of their income on housing in return for living in smaller, rented accommodation,” said Lindsay Judge, senior policy analyst at Resolution. “For any housing strategy to be relevant and effective for people of all ages, it must include this combination of support for renters, first time buyers and ultimately a level of housebuilding that matches what the country needs.”
At the end of 2017 there were 11,000 units of build-to-rent properties under construction, nine percent more than the end of 2016 and 140 percent more that the average year-end level in the eight years through 2009 to 2016, according to data compiled by Molior London.
With assistance from Sharon Smyth