Almost five million adults in Britain are unable to move out of their parents’ homes because of soaring housing costs, new research has found.

The Skipton Group Home Affordability Index, produced with Oxford Economics, reveals that 98% of adults living with their parents cannot afford to buy the average first-time buyer property in their area based on their own income. Even if the challenge of saving for a deposit is removed, 97% would still be unable to afford essential housing costs.

THE NATIONAL PICTURE

The problem is not confined to London and the South East. Fewer than 10% of adults living at home with parents can afford the average starter home in their local area, with affordability dropping below 1.5% in London, the East of England and the South West.

The report highlights the wider pressures of living independently. If adults were to move out, more than nine in 10 would face housing costs exceeding 45% of their income – well above accepted affordability thresholds.

The latest census shows that the number of adults living at home has surged to around five million. While some may assume this reflects short-term “boomerang” arrangements, Skipton’s survey of 2,000 people found that 70% had never moved out. A majority – 51% – reported a sense of “lost youth” from remaining in the parental home.

INTERGENERATIONAL STRAINS

The research also examined the impact on older homeowners. Parents who could otherwise downsize might unlock an average of £72,400 in equity or save £2,400 annually in rent, yet the presence of adult children often prevents such moves. For households on lower incomes, the potential equity release could equate to 60% of their non-property wealth.

Stuart Haire, Skipton Group chief executive, said: “This data lays bare the systemic failure of our housing ecosystem. It’s a failure that is locking millions of young people out of independence, home ownership, and long-term financial stability.

“When 98% of adults living with their parents can’t afford to leave, they’re not just facing a housing crisis – they’re facing a crisis of opportunity.”

AFFORDABILITY STAGNATES

The Index, which tracks affordability across all 363 local authorities, found that while the ability to buy a home has remained largely unchanged, the cost of running one has worsened. Higher energy prices and rising rents have pushed more households into difficulty.

In the second quarter of 2025, just 11.5% of would-be first-time buyers could afford a home in their local area – the same level as at the end of 2024.

CALLS FOR REFORM

Skipton is calling for reform of property taxes to ease the burden on first-time buyers and for protections around the Lifetime ISA. It is also advocating for innovative mortgage products to help renters and aspiring buyers onto the ladder.

These include Track Record, its 0% deposit mortgage based on rent payment history, and Delayed Start, which allows buyers to move into a home without payments for the first three months. Joint Borrower Sole Proprietor mortgages, enabling parents to support their children without gifting deposits, are also part of its offering.

Haire said the group was committed to finding solutions: “Whether through our lending, our estate agency network, or through research like this, we are determined to help people take meaningful steps towards a home of their own.”