Today's young adults are much less likely to own a home than their parents' generation

Today’s young adults are much less likely to own a home than their parents’ generation, but those owning a home well before the crisis have gained from house price increases and a sharp fall in housing costs.

The UK has witnessed a substantial and sustained increase in house prices since the 1990s. This long-term rise in house prices, and the financial crisis which led to falls in real incomes and reduced availability of high loan-to-value mortgages, are perhaps the main causes of widespread concern about the ‘affordability’ of housing. In a new election briefing note funded by the Nuffield Foundation and published today, IFS researchers set out a range of evidence on how the affordability of housing, and – related to that – the kinds of housing that people access, have been evolving.

The real price of purchasing a typical house, as measured by the Nationwide house price index, nearly trebled between 1995–96 and 2007–08, taking it 77% higher than its previous peak in 1989. When thinking about affordability, we of course want to account for changes in incomes too. At their peak in 2007–08, average house prices were 7.6 times average net household incomes – significantly higher than the ratio of 6.4 at the end of the previous house price boom in 1989. But real house prices then fell by nearly a quarter between 2007–08 and 2012–13. This left the price to net household income ratio at 6.2 – back to around its early 2000s level and close to its level at the end of the 1980s boom. Significant real growth in house prices resumed from 2013–14.

When considered in combination with the lesser availability of mortgage credit since the crisis, it is not surprising that there is concern over the ease of access to homeownership. And in London, house price to income ratios have bounced back substantially more quickly since the financial crisis. Indeed, if we use pre-tax average earnings (for which, unlike net household income, we have data beyond 2012–13), we see that in 2013–14 the price to earnings ratio in London had already surpassed its pre-crisis peak.

Read the full Observation and download the briefing note on the IFS website >>

Explore our projects

Older-man-reads-textbook-Assembling-data-jigsaw-Greater-Manchester-PROJ
In progress

Welfare | 2020 - 2024

Assembling the data jigsaw: powering robust population research in MSK disease

View project
Medical-professional-massages-patient-knee-Understanding-joint-replacement-surgery-decision-making-for-older-patients-PROJ
In progress

Welfare | 2020 - 2023

Supporting older patients to make informed decisions about knee surgery

View project
Woman-medical-professional-treats-patient-impact-MSK-conditions-outcomes-other-illnesses-PROJ
In progress

Welfare | 2020 - 2022

The impact of musculoskeletal conditions on outcomes of other illnesses

View project
Female-nurse-sees-patient-in-office-Integrating-enriched-longitudinal-data-North-Staffordshire-Stoke-on-Trent-PROJ
In progress

Welfare | 2020 - 2025

Enriched data integration for population musculoskeletal health intelligence

View project
Older-man-and-woman-walk-together-Geographical-mapping-prevalence-outcomes-MSK-conditions-Wales-Scotland-PROJ
In progress

Welfare | 2020 - 2022

Mapping rheumatic and musculoskeletal disease in Scotland and Wales

View project
New

Welfare | 2020 - 2022

Older people in England: the geography of challenges and opportunities

View project
New

Welfare | 2020 - 2022

Vulnerability, migration and well-being: experiences, perceptions and barriers

View project
Senior-woman-enjoys-video-call-on-smartphone-Social-cohesion-in-context-of-COVID-19-PROJ
New

Welfare | 2020 - 2021

Social cohesion in the context of COVID-19

View project
New

Education | 2020 - 2020

The impact of COVID-19 on mainstream schools in England

View project
Toddler-gleefully-eats-baked-beans-How-COVID-19-is-affecting-food-security-proj
New

Welfare | 2020 - 2021

How the COVID-19 crisis is affecting food security

View project
Woman-looks-at-smartphone-screen-How-the-UK-public-gets-information-about-COVID-19-PROJ
New

Welfare | 2020 - 2020

How the UK public gets information about COVID-19

View project
New

Welfare | 2020 - 2021

COVID-19 and families on a low income: poverty in the pandemic

View project
Serious-teenage-girl-gestures-as-sits-on-couch-in-school-counselor-office-Mental-health-service-provision-for-children-state-care-England-PROJ
New

Justice | 2020 - 2021

Mental health service provision for children in state care in England

View project
New

Justice | 2020 - 2022

Youth custody: Educational influences and labour market consequences

View project
New

Welfare | 2020 - 2022

Vulnerability, migration and well-being: experiences, perceptions and barriers

View project
Toddler-gleefully-eats-baked-beans-How-COVID-19-is-affecting-food-security-proj
New

Welfare | 2020 - 2021

How the COVID-19 crisis is affecting food security

View project
New

Education | 2020 - 2020

The impact of COVID-19 on mainstream schools in England

View project
New

Welfare | 2020 - 2022

Older people in England: the geography of challenges and opportunities

View project
Senior-woman-enjoys-video-call-on-smartphone-Social-cohesion-in-context-of-COVID-19-PROJ
New

Welfare | 2020 - 2021

Social cohesion in the context of COVID-19

View project
Teenage-girl-looks-at-smartphone-next-to-laptop-Growing-up-under-COVID-19-PROJ
New

Education | Welfare | 2020 - 2021

Growing up under COVID-19

View project
Young-boy-wearing-glasses-watches-laptop-school-lesson-with-notepad-The-effects-COVID-19-on-families-time-use-child-development-PROJ
New

Education | 2020 - 2022

The effects of COVID-19 on families’ time-use and child development

View project
New

Welfare | 2020 - 2022

COVID-19 social study

View project
Empty-street-with-cyclist-and-pedestrian-in-distance-Law-and-compliance-during-COVID-19-PROJ
New

Justice | 2020 - 2021

Law and compliance during COVID-19

View project
New

Welfare | 2020 - 2021

COVID-19 and families on a low income: poverty in the pandemic

View project
Older-man-reads-textbook-Assembling-data-jigsaw-Greater-Manchester-PROJ
In progress

Welfare | 2020 - 2024

Assembling the data jigsaw: powering robust population research in MSK disease

View project
Medical-professional-massages-patient-knee-Understanding-joint-replacement-surgery-decision-making-for-older-patients-PROJ
In progress

Welfare | 2020 - 2023

Supporting older patients to make informed decisions about knee surgery

View project
Woman-medical-professional-treats-patient-impact-MSK-conditions-outcomes-other-illnesses-PROJ
In progress

Welfare | 2020 - 2022

The impact of musculoskeletal conditions on outcomes of other illnesses

View project
Female-nurse-sees-patient-in-office-Integrating-enriched-longitudinal-data-North-Staffordshire-Stoke-on-Trent-PROJ
In progress

Welfare | 2020 - 2025

Enriched data integration for population musculoskeletal health intelligence

View project
Older-man-and-woman-walk-together-Geographical-mapping-prevalence-outcomes-MSK-conditions-Wales-Scotland-PROJ
In progress

Welfare | 2020 - 2022

Mapping rheumatic and musculoskeletal disease in Scotland and Wales

View project
New

Welfare | 2020 - 2022

Older people in England: the geography of challenges and opportunities

View project
Senior-woman-enjoys-video-call-on-smartphone-Social-cohesion-in-context-of-COVID-19-PROJ
New

Welfare | 2020 - 2021

Social cohesion in the context of COVID-19

View project
New

Education | 2020 - 2020

The impact of COVID-19 on mainstream schools in England

View project
New

Welfare | 2020 - 2022

Vulnerability, migration and well-being: experiences, perceptions and barriers

View project
Toddler-gleefully-eats-baked-beans-How-COVID-19-is-affecting-food-security-proj
New

Welfare | 2020 - 2021

How the COVID-19 crisis is affecting food security

View project
Teenage-girl-looks-at-smartphone-next-to-laptop-Growing-up-under-COVID-19-PROJ
New

Education | Welfare | 2020 - 2021

Growing up under COVID-19

View project
In progress

Education | 2020 - 2021

Post-16 educational trajectories and social inequalities in political engagement

View project
Reported

Welfare | 2019 - 2020

Valuing data: foundations for data policy

View project
Reported

Welfare | 2019 - 2020

Revaluation and reform: bringing council tax into the 21st century

View project
Reported

Welfare | 2018 - 2019

Atlas of inequality: understanding the local nature of a global phenomenon

View project
Reported

Welfare | 2018 - 2018

Interdisciplinary conference on evidence use in policy

View project
Reported

Welfare | 2018 - 2019

Overview of the major ethical issues arising from data, algorithms and AI

View project
Reported

Justice | Welfare | 2018 - 2019

Pathways of incarcerated children in care

View project
Reported

Welfare | 2018 - 2018

Council tax support schemes’ impact on claimants & local authorities

View project
Reported

Welfare | 2018 - 2018

Improving survey representation of non-resident parents

View project
Reported

Justice | Welfare | 2017 - 2018

Visualising data in care proceedings

View project
Reported

Education | 2017 - 2018

Growing up digital

View project
Reported

Justice | Welfare | 2017 - 2018

Addressing the ‘care cases’ crisis: a sector-led review

View project
Reported

Welfare | 2017 - 2018

Vulnerable migrants and well-being: A pilot study

View project
Search projects

We improve people’s lives by funding research that informs social policy, primarily in EducationWelfare and Justice. We also fund student programmes that give young people skills and confidence in science and research.

We offer our grant-holders the freedom to frame questions and enable new thinking. Our research must stand up to rigorous academic scrutiny, but we understand that to be successful in effecting change, it also needs to be relevant to people’s experience.

Profile

COVID-19 response

Nuffield-funded social scientists are conducting COVID-19 research in real-time, to capture people’s experiences of the social, cultural and economic impacts of the pandemic.