The UK now has one of the lowest levels of home ownership in Europe, as shortage of supply has helped to push up prices beyond the reach of many ordinary families.
Figures from Eurostat, the EU’s statistics agency, show that home ownership in the UK is now lower than any other European country except for Austria, Denmark and Germany, which have a longstanding culture of renting.
While home ownership has fallen across most of Europe in recent years, in the UK it has fallen faster than elsewhere – from 74 per cent in 2007 to 63 per cent in 2015. Those who do own their own home are also more likely to have a mortgage or loan secured against it than in almost any other European country. Only 26 per cent own the property outright.
The figures show that in a few countries including France and Portugal, home ownership has increased. In western Europe, Spain had the highest rate of home ownership at 78 per cent, while in eastern Europe, it was Romania with 98 per cent ownership.
The Eurostat data comes as separate figures from the Office of National Statistics show that one in four neighbourhoods in England and Wales is unaffordable to many residents because the average income is below the amount required to buy an entry-level property.
It says the cost of an entry-level property has increased by nearly 20% in a decade to £140,000, and nearly £180,000 for new-build home. A typical household in England and Wales would need an income of £26,444 to borrow enough for an entry-level property. Homes were most affordable in the North of England.
Meanwhile research by Lloyds Bank has shown that home affordability in UK cities is at its worst since 2008. Over the past five years, the average city house price has risen by 32% while average city earnings have risen only by seven per cent. House prices as a multiple of average annual earnings have risen from 5.5 in 2012 to 6.9 now – the worst since 2008 when the ratio stood at 7.2.
The report named Oxford as the least affordable city but again highlighted the North South divide, with Northern cities generally being more affordable than those in the South.
