UK house prices: The high cost of getting on the property ladder is stopping people having kids

 
Lynsey Barber
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Fewer children means a bigger burden for looking after the elderly population (Source: Getty)

The high cost of buying a home in the UK is having unintended consequences on the population according to one think tank, dubbing the issue a "fertility crisis".

Young people are holding off having kids because of the high price of settling down, new research from the Adam Smith Institute (ASI) claims.

The current cost of a property in the UK stands at £218,390, although, that was around £2,000 less than the previous month according to the latest data from Halifax in what may be a tiny ray of hope to wannabe buyers.

Read more: UK house prices have fallen in June for the first time since 2009

In what it describes as a "collapse" in home ownership among young people (it fell from 60 per cent among 25-34 year-olds to 35 per cent between 2004 and 2014), the think tank has even managed to put a figure on how many kids have not been born as a result - 160,000 between over nearly two decades since 1996.

The housing crunch is forcing couples to put off having a family and have smaller ones. They calculate that a ten per cent rise in house prices in that time up to 2014 resulted in a 4.9 per cent decrease in birth rates among renters and only a 2.8 per cent rise for homeowners.

ASI says if the trend continues there will be a knock-on effect on the economy.

“The housing crisis is a well-known immediate economic problem, but this report showcases how it is wrecking the lives of the people of this country, preventing them from having the children they want to have," said the paper's author, Andrew Sabinsky.

"This private tragedy will, in the long-run, entail massive knock-on costs to public finances. Housing market liberalisation is something the government should do anyway, but this report outlines a new set of pressing reasons for it to act.”

The population aged over the age of 85 doubled between 1985 and 2010 and is estimated to make up five per cent by 2035. And the average age is set to hit 42.9 years by 2039, up from 40 in 2014 and 35.4 in 1985.

Read more: Is the UK heading for a house price crash? These economists thinks so

An ageing population means there will be more pressure on the NHS: it costs three times as much to treat someone over 85 than someone aged between 65 and 74.

And further estimates suggest the number of working age people for every pensioner will fall from 3.2 to 2.7 by 2037.

That means fewer young people will have to pay more to support pensioners in what ASI describes as a "demographic time bomb".