A 20 per cent increase in young adults living with their parents over the past 15 years has been revealed in a new report from the Office of National Statistics.
The new figures show that almost 3million adults aged between 20 and 34 are living at home with their parents, an increase of almost half a million since 1997.
The news is worrying not just for those stuck at home with mum and dad, but also for parents who may be forced to pay their children’s way for a lot longer than they were expecting.
Bank of Mum and Dad: more young adults than ever are staying at home with their parents
The numbers of young adults living at home have grown steadily since 1997, and throughout this growing trend it has been more men than women who stay living with their parents. 1.8 million 20-34 year old men compared with 1.1 million women of the same age group remain in their family home. The ONS said this was influenced by women being more likely to cohabit with older partners and access higher education.
And the dramatic increase in both sexes remaining at home coincides with rocketing average house prices.
Since 1997, the average house price has risen by 141%, according to Halifax figures, from £66,500 to £160,000. Nationwide’s figures show that in 1997 the average house price to earnings ratio stood at three, whereas today it is just above five, having peaked at six-and-a-half in 2007.
Meanwhile, although mortgage rates have tumbled and house prices have fallen 10 to 20 per cent across the major indices since the financial crisis hit in late 2007, lenders are demanding much higher deposits from first-time buyers.
New buyers must now raise a 25 per cent deposit to get market-leading rates, compared to five to ten per cent in 2007. That means they need a £40,000 deposit on the average home.
Squeezed generation: This chart shows the increase in house prices over the Queen’s 60 years on the throne, with a dramatic acceleration from 1997 on
Less Londoners live with parents
London had the lowest percentage of young adults still living at home – 19.7 per cent – largely due to house sharing with friends being more common here than in other parts of the country. The capital also attracts more young workers away from their home locations. In London 6.8 per cent of households consist of two or more unrelated people – more than double the national average.
Meanwhile in Northern Ireland the picture is very different. Here 35.3 per cent of young adults still live with their parents, firstly, because more students remain at home whilst studying and secondly, because there is a more traditional picture here, where couples marry earlier and fewer cohabit before marriage than in the rest of the British Isles.
Despite the increase in young adults living at home, the ONS say that 20-34 years olds in the UK still leave their parental home earlier than those in southern and Eastern European countries like Spain and Italy.
Nicholas Ayre of UK buying agents, Home Fusion, said that the ONS figures, ‘say all you need to know about the property market and economy – they’re broken.’
‘Property ownership is a pipe dream for the majority of today’s young adults while rents are at astronomical levels. Renting was once the default option for people who were saving to own their own homes. Now it’s a luxury. For a huge number of today’s young people, the only option, quite clearly, is to live with their parents.
‘The root cause of this problem is a lack of supply. There just aren’t enough properties for people to live in. Both the current and previous Governments said they would address this pressing issue, but neither has done so.
‘With the economy in a coma, lenders beating a retreat and the eurozone threatening to unravel, it looks like the number of young adults living with their parents will continue to rise in the years ahead.’
What the figures mean for parents
Set against a backdrop of higher university tuition fees and increased unemployment these figures spell bad news for parents who may find themselves funding their children for a lot longer than they were expecting.
Research by Standard Life found that over half of parents saw it as ‘their duty’ to financially support their grown up children and they expect to spend an average of £15,495 for each child aged 18 or over.
Of them, 37 per cent said they recognised that the current economy will hinder their children’s potential to support themselves and expect to contribute towards tuition fees, living costs, weddings, house deposits and even debts.
Julie Russell, Head of Customer Relationships at Standard Life, said: ‘The economic downturn and price increases have left many parents expecting to have to financially support their children into adulthood. This creates a significant challenge – how to balance the desire to provide for your child, even when they become adults, as well as save to secure your future.’
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