68% of the British population have lived in rented accommodation at some point in their lives, occupying rented homes for an average of 11.6 years – according to a new survey conducted by specialist buy-to-let lender Paragon Mortgages. The report provides a ‘snapshot’ of how people’s choice of accommodation has changed over the years.

While home ownership aspiration remains high (over 80%), a shrinking proportion of people now manage to buy by age 30 (down from 68% to 60%).

Affordability principally explains why people don’t buy immediately, but increasingly people also cite lifestyle reasons – e.g. not ready to commit, or wanting flexibility.

John Heron, managing director of Paragon Mortgages, comments: “This demonstrates that renting is not a minority practice but rather one that most people do at some point in their lives, and in many cases for long periods of time. Over a third of people have lived in rented accommodation for more than 5 years, and 21% for more than 10 years.”

For older people, the average length of time spent in rented homes is, not surprisingly, longer. The over 65 age bracket, for example, has lived in rented homes for an average of almost 23 years, and 41% of them have lived in such accommodation for over 10 years.

Even among the under 35s, the average time spent in rented accommodation is over 4 years, and 62% have lived in rented homes at some point. The proportion of people who have never lived in rented accommodation is higher among younger age groups than older ones, but renting is very common among at all ages.

The survey found that, despite the well-known difficulties encountered in getting onto the property ladder, the age at which people first move out of the family home has fallen slightly over the generations.

People over 65 left home at almost 22 years, but for the 25-34 year olds the average age of leaving home had drifted down to just over 20 years. The 18-24s are, of course, not representative as a large minority is still at home.

Rented accommodation, both privately rented and social housing has grown in popularity as people’s first choice on leaving the family home over the years. For people now in the 65+ age bracket, 52% moved into rented accommodation on leaving home, a proportion that rose to 55% for the 35-44s and to a massive 74% for the 18-24s.

“What is clear,” says John Heron, “is that young people’s desire to escape the family home and establish themselves in independent households at an early age is getting stronger. People are leaving the family home at a younger age than they used to, and increasingly young people move into rented accommodation.”

Private renting has grown in popularity as people’s preferred choice of first home over the generations: just 38% of over 65s moved into privately rented properties on leaving home, while for the 25-34 age bracket the proportion had risen to 50% and for the 18-24s it stood at 47%.

John Heron explains: “Publicly-owned housing has generally dwindled in importance, as much social and council housing was sold under right-to-buy schemes and not replaced by new build. Private rentals have grown to fill the gap, with the number of rented homes increasing by about 18% between 1988 and 2002, according to ODPM figures.”

Looking at people who move straight into a property they have purchased, there was a ‘golden age’ for people now in their mid forties to mid fifties (45-54), a significant proportion of whom were able to purchase a home immediately on leaving the family home. Of this age bracket, one-third (33%) moved straight into their own (bought) home – a significantly higher proportion than for those people aged between 55-64 (21%) or over 65 (19%).

Since then, younger age groups have been progressively less likely to buy their own home straight away, with the share falling to 29% for 25-34 year olds and to just 19% of 18-24s.

In terms of the actual age when people purchased their first homes, it is apparent that fewer people succeeded in purchasing before the age of 25 in the younger age bracket than they did in the ‘golden age’ bracket of 35-54.

Why people rent rather than buy

When asked why they rent rather than buy, the vast majority of people surveyed cited affordability constraints as the principal reason.

However, while the proportion of people giving this as their main reason for renting fell between the 65+ and 35-44 age brackets (perhaps suggesting that affordability became progressively less of an issue for people over this period) there was a sharp rise in the proportion of people attributing their decision to rent to affordability issues among the under 35s: in the youngest (18-24 age bracket), 76% gave this as the main reason.

A variety of other reasons were cited for renting rather than buying, with not being ready to commit the most frequented mentioned.

Among 25-34s, ‘not ready to commit’ was mentioned by a much higher 21%, while the related issue of ‘wanting flexibility’ was mentioned by 9% - a total of 30% giving these two reasons. This compares with just 16% of people over 55 who cited these reasons.

John Heron points out: “Affordability of property for purchase is clearly a major constraint on people and a major reason why they rent their homes. But renting is also increasingly a lifestyle choice.”

“Almost a third of people aged 25-34 consciously decide not to buy because they do not want the commitment of house purchase yet, or want flexibility in their lifestyle. This perhaps reflects changing social habits whereby people in their late twenties and early thirties are putting off the time at which they ‘settle down’.”

Looking specifically at the responses of people between 18-24 who still live at home gives a good insight into possible future trends.

More than half of these 18-24s (51%) intend to move into rented accommodation on leaving home, and they are four times more likely to move into private rented than social rented accommodation: 41% say they will choose private rented, versus just 10% for social rented.

John Heron says: “The availability of privately rented homes would seem essential if young people’s aspirations to leave home at an early age can continue to be achieved.”

John Heron concludes: “Among younger age groups, home ownership aspiration remains strong, with over 80% either already owning or wanting to own their own property. However, the proportion of them who actually buy by the age of 30 has declined to around 60%, from 68% for the 45-54 year olds, and this trend seems set to continue."

"This is partly driven by affordability issues but also, importantly, by lifestyle choices as people elect to rent homes while in their twenties, either on their own or as sharers. The vast majority of them rent privately, and the continued health of the private rented sector remains key to young people’s ability to fulfil their lifestyle ambitions.”