New analysis looks at the rate of co-residence among young adults and impacting factors…
The proportion of UK adults in their 20s and 30s living at a parental home has risen by over a third over the last two decades.
A new report from the Institute for Fiscal Studies (IFS) looks at patterns of young adults at ‘Hotel of Mum and Dad’ in the UK and how the rate of co-residence varies across dimensions such as income, region and ethnicity.
The key findings indicate that between 2006 and 2024, the rate of co-residence among 25-34 year olds rose from 13% to 18%.
In the most recent data, the proportion is actually down after a spike up to 21% during the COVID-19 pandemic. However, the five percentage point rise since 2006 still represents around 450,000 more 25-34 year olds living at a parental home in 2024 than if the proportion had remained at its 2006 level.
The figures show co-residing in 2023-24 is more common for young men (23%) than for young women (15%), and rates of co-residence are particularly high among UK-born Bangladeshi (62%) and Indian (50%) 25-34 year olds.
Living with parents is particularly common among those on the lowest incomes with almost half of 25-34 year olds in the bottom fifth by income co-residing, compared with just 2% of those in the top income quintile.
Co-residence can be seen as a transfer from parents to their adult children, the report states, allowing these children to avoid paying full – or any – rent and potentially to save on other costs such as heating.
Increases have been concentrated among those in their 20s and have tended to be higher in parts of the country that have seen particularly high house price growth since 2006.
The largest increases in co-residence between 2006–07 and 2023–24 occurred in the East, South West, North West and South East of England. While London has seen the highest house price growth over this period, it saw only slightly above average increases in the rate of co-residence.
Changes in the age, sex, education, immigrant and ethnic composition of 25-34 year olds cannot explain the increased rates of co-residence, the report says – in fact a decline would have been expected.
It summarises that within the age group, the population has become more educated and slightly older on average, and a rising share have been born outside the UK. All characteristics, the analysis states, associated with being less likely to co-reside at a parental home.
Lower rates of parenthood and marriage and increased reported experience of ill health among 25- 34 year olds have coincided with the increase in co-residence over the period. Since 2006, the proportion of 25-34 year olds who are married has fallen sharply from 39% to 29%, and the proportion with a dependent child has fallen even more, from 45% to 33%.
In addition, the proportion of 25-34 year olds with a health condition lasting at least a year has risen from 17% to 31%.
The changes in marital status, parenthood and health status together with changes in 25-34 year olds’ region of residence, age, sex, education, migration status and ethnicity can explain at most one-tenth of the observed increase in co-residence since 2006, according to the report (probably less than, as some of these trends will be partly driven by co-residence.)
Therefore, it surmises, it is likely that other factors – such as the declining affordability of housing – have been much more important in driving up rates of co-residence among this age group.