Home Ownership Down To Lowest Level In 10 Years
Government statistics for 2007 show a further decline in home ownership making it the second year in a row as figures dropped to their lowest since 1998.
With the number of owner-occupiers falling by 83,000 to 14.54 million, the rate of home ownership now stands at 69.8%. The main theory put forward is the dramatic increase in house prices which the UK has experienced over the past 10 years.
As house prices have become further and further out of reach for the average income, thousands of potential buyers have literally been pushed out of the property market. Particularly affected are first-time buyers who are simply unable to come up with a deposit or be granted a mortgage in the first place.
The recent effects of the credit crunch and tighter lending conditions from lenders have only added to the mounting difficulties already faced by buyers wanting to get a foot on the property ladder.
Martin Ellis, chief economist at Halifax said, "The fall in the total number of owner-occupied households in England in 2007 largely reflects the increasing affordability difficulties faced by many potential purchasers as a result of the rapid rise in recent years."
The figures were initially produced by the Department for Communities and Local Government (DCLG). They showed that the slight increase of 1.3% in the number of homes owned outright was outweighed by a 2% fall in the number of people buying a home with a mortgage.
The boom for owner-occupation in the UK took off in the 1950's and eventually overtook the private rented sector in 1961. Home ownership was further boosted in the 1980's when council tenants were granted the right-to-buy. It reached its peak of 71% in the year 2000 but since then slowed down and has now begun to fall.
Another factor that has had an effect on property ownership is the growth in buy-to-let mortgages. The increased number of landlords buying properties in order to rent out has accounted for 10% of all new mortgages.
Published on February 14, 2008
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