As house prices continue to soar in the UK, particularly in London, a new report has warned that a generation of people aged under 35 may never own property.
The average price of property in London reached £536,000 in December 2015, £200,000 more than it was just before the recession in 2008, dwarfing growth in other UK regions.
London prices rose 9.7% year on year, compared to growth of just 0.9% in the northeast of England, where houses are £155,000 on average, the cheapest in the country.
The data, from the Office for National Statistics, shows that overall UK house prices rose 6.7% to an average of £288,000 in the year to December, suggesting that a country-wide average price of £300,000 is not far away.
House prices in Scotland fell 0.2% in the year to December 2015.
On Tuesday, a report from the Resolution Foundation argued that people aged under 35 face becoming permanent renters as a whole generation is frozen out of the housing market.
The report pointed out that whereas more than half of under-35s on middle incomes owned property in 2000, the figure today is 25% and is likely to be 10% nationally and 5% in London by 2025.
The report argues that people aged under 35 are now much less likely to become homeowners than their parents and grandparents.
Matt Whittaker, chief economist at the Resolution Foundation, said: "With the average modest income household having to spend 22 years to raise the money needed for a typical first-time buyer deposit – up from just three years in the mid-1990s – it's no surprise that owning looks so out of reach."
Also on Tuesday, a report from the House of Commons Treasury select committee criticised chancellor George Osborne's housing policy in a report released on Tuesday and called on the government to do more to provide decent rented accommodation.
"Addressing the 'home ownership crisis' must not come at the expense of a shortage of homes to rent," it said. "The Chancellor should make clear what he intends to do to help those who want or need to rent, and to ensure a healthy supply of properties in the private rented sector."
The ONS report noted that while supply of housing in the UK remains limited, there is no shortage of demand.
The number of new houses being built shrank by 1.8% in the year to November.
Meanwhile, the number of mortgage approvals grew by 21.3% in the year to December, according to figures from the Bank of England.
The government launched its revamped "Help to Buy" scheme this month, which allows first-time buyers to borrow up to 20% of the value of a home from the government, which rises to 40% in London.
Some 15,000 people signed up to the scheme in London in its first week – but Resolution criticised the scheme for only helping those people who may have been able to buy property anyway.
Osborne has also pledged to build more affordable housing and to increase stamp duty paid by buy-to-let landlords and second home owners.
Patrick Smith is a senior reporter for BuzzFeed News and is based in London.
Contact Patrick Smith at email@example.com.
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