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Millennials Pay £44,000 More In Rent Than Their Parents Did

"Young people today are paying a heavy price for decades of falling home ownership."

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The rising costs of renting and the spiralling cost of homes in the UK mean that the current generation of 20-somethings will have spent £44,000 more than their parents' generation, on average, by the time they are 30.

Research from the Resolution Foundation (RF) released on Saturday argued that a drop in homeownership among the young has lowered living standards and led to a greater concentration of wealth among the over-50s.

The Halifax building society estimates that the average first-time buyer needs a deposit of £33,000, highlighting the difficulties renters face in raising enough to buy property.

Millennials are generally understood to have born between the early 1980s and 2000, whereas baby boomers are the generation born in the population boom between World War II and the mid-1960s.

RF's figures are taken from a new study on intergenerational fairness, due to be released on Monday.

The report shows that:

  • Almost two thirds of baby boomers owned their own house by the time they were 30, compared to 42% of people in their 20s today.
  • Half of all non-commercial rent goes to the baby boomer generation, some £3.8 billion a year.
  • By contrast, millennials receive 7% of the nation's private rent income, worth £339 million.
  • Generation X, those born between the mid-1960s and the early 1980s, spent twice as much as the baby boomers; millennials spend twice as much as the previous generation.

Before taking office as prime minister this week, Theresa May acknowledged the housing crisis and the intergenerational wealth gap in a speech on Monday.

"Unless we deal with the housing deficit, we will see house prices keep on rising," she said. "Young people will find it even harder to afford their own home.

"The divide between those who inherit wealth and those who don’t will become more pronounced. And more and more of the country’s money will go into expensive housing instead of more productive investments that generate more economic growth."

Laura Gardiner, senior policy analyst at the RF, said: "The nation’s housing crisis is perhaps the most visible example of growing inequality between generations.

"Young people today are paying a heavy price for decades of falling home ownership.

"Britain’s continuing failure to build enough homes means that unless we change course the struggle of young people to own their home is only going to get worse.

Gardiner pointed out, however, that support for housebuilding is growing among older generations, giving hope that there will be support for the kind of large-scale house-building initiatives housing campaigners have long called for.

A House of Lords committee report last week said that England needs 300,000 new homes to be built every year to tackle the chronic housing shortage and stop prices rising.

Patrick Smith is a senior reporter for BuzzFeed News and is based in London.

Contact Patrick Smith at patrick.smith@buzzfeed.com.

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