Over half of UK homes will be rented – with a third rented privately – by the year 2032, it has been predicted.
It will be the first time in 60 years that the majority of homes will not be owner-occupied – and by then home ownership will be the preserve of the elderly.
A report by the Intermediary Mortgage Lenders Association forecasts that just 49.2% of households in the UK will own their own homes in 18 years’ time.
At peak, in 2003, 71% of households in England were owner occupied. Today the figure is 65%, and the IMLA says the proportion is set to drop.
The report says: “If current trends continue without a major policy or economic shift to address the shortage of new homes, the majority of UK households will be renting in the private and social sectors by 2032 for the first time since the early 1970s.”
Private renting has already overtaken the social sector to stand at 18% of all households, while according to the Department for Communities and Local Government, of the 14.3m home owners in England, the largest number are already aged 65-plus.
The IMLA report says there are multiple trends driving the rise of private renting, including the fall in social housing; growing obstacles to home ownership; more students; high immigration levels; later marriage; and more relationship breakdowns.
It forecasts that continuing falls in owner occupation and social renting would also mean more than a third of households renting privately within two decades – twice as many as today.
Peter Williams, executive director for IMLA, said: “This report is a fresh look at how and why the private rental sector has grown.
“It asks important questions about our current direction of travel and the failure to build enough homes to support the rising population.”