However, new research from Halifax, one of the UK’s biggest mortgage lenders, show that not all are forced to live in rented properties – many actually choose and prefer to rent.

"Although this is not good news for first-time homebuyers in the UK, it’s great news for South African investors who own London property or who are in a position to break into the UK market. Our clients will be delighted.” so said Mike Smuts, managing director of Smuts & Taylor, a South African investment firm based in London this week when asked to comment on the latest research from Halifax. 

The report from one of the UK’s biggest mortgage lenders show that fifty years ago, the average home cost £2,507 and one in seven had the loo outside. A half century on, the average home costs £162,085 - but spare a thought for the two in every 1,000 households that still rely on an outside loo!

Even when taking into account the so called housing “crash” of recent years, average house price inflation over the last decade has far outstripped average wage increases. House prices rose by 273% in real terms between 1959 and 2009 while the growth in real earnings was only 169% over the same period.

This disparity has made it increasingly difficult for first-time buyers to enter the market and the average age of a first-time purchaser buying without assistance is now 38. Many cheered on the housing slowdown in the belief that it will help them onto the first rung of the housing ladder when in fact, rather than being boosted by falling house prices, first-time buyers’ ability to purchase a home has been seriously undermined during the course of the slowdown. This is mainly due to the fact that lenders tightened their lending criteria dramatically in the aftershock of the credit crunch.

This has led to a 40% increase in the private rented sector over the last five years while home ownership has slipped back to 68%. In 1961, 33% of homes were privately rented, but this fell over 30 years to 9%. It has since started to rise again, reaching 14% in 2008.

However, not all are forced to live in rented properties – many choose and prefer to rent. A 2007 Council of Mortgage Lenders survey found that only 50% of those under 25 have any desire to own their own home within 2 years. Another study concluded that around 12% of all tenants see themselves as “permanent lifestyle tenants.”

Between 1959 and 2009 Britain's population grew by 9 million to 61.8 million, but the number of households rose from 16.7m to 26.6m indicating that today’s Brit are also far more likely to be living alone. As recently as 1971, fewer than one-in-five households were occupied by a single person, but this rose to one-in-three by last year.

In total, Britain has built 13m houses over the past 50 years, according to Halifax, but the housing supply in the UK has slowed to its lowest level since the Second World War, with only 156,816 houses completed in 2009. The Treasury Commission ‘Barker’ report has established that the UK needs 300,000 new homes per annum to satisfy the growing demand, with a minimum 35,000 new homes a year in London alone. The UK’s house builders are yet to hit this target.

“This recent data add to an escalating concern over lack of supply.” said Mike Smuts. “Simply put, there are not enough houses to go around and as the demand for high quality rental properties keeps growing, investors will prosper.”