Page last updated at 11:51 GMT, Wednesday, 15 April 2009 12:51 UK

Are our finances allowing us to be alone?

By Kevin Peachey
Personal finance reporter, BBC News

People in Birmingham give their views on living with parents

Celebrated French thinker Jean-Paul Sartre suggested that "Hell is other people". It is a philosophy that seems to have been taken on by the UK population in the last few decades.

The proportion of people living alone more than doubled between 1971 and halfway through 2008, according to the Office for National Statistics (ONS).

Its annual Social Trends report reveals that the proportion of UK households in which the resident is under retirement age and lives alone has risen from 6% to 15%. Fewer are getting married and, if they do, the wedding comes when they are older than previous generations.

But sole habitation is an expensive business - too much so for some young adults, the research into the state of the nation suggests.

Nearly a third of men aged between 20 and 34 - that's 1.8 million people - and 18% of women of the same age - about 1.1 million - lived with their parents in the second quarter of 2008.

Young adults are tending to stay in the parental home longer than their parents did
ONS report

The numbers are on the rise, especially among 20 to 24-year-olds. This is because more young people are going into further education and the unemployment rate is higher than for older people.

Moreover, nearly four in 10 UK young adults said the main reason they lived with their parents was because they could not afford to move out - also a key concern for European youngsters. Some 44% put it down to the lack of affordable housing.

Some 12% said they stayed for the home comforts without the responsibilities.

Buyers' battle

The ONS report is a retrospective study of the state of the UK. Most of the figures only reveal the situation up to 2006-7.

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The very latest data in the report shows the situation in the first half of 2008 - before the worst effects of the global economic downturn and UK recession were felt by consumers.

As a result, some of the challenges for young people wanting to buy their own homes in the UK are not recorded.

Although homes for first-time buyers have become more affordable over the last year, the squeeze on mortgage availability has just got tighter.

The typical deposit required for a home loan has reached a record 25%, according to the Council of Mortgage Lenders (CML). There is some evidence to suggest that many approach parents for financial help.

Perhaps these parents pay up simply to make sure their brood finally leave the nest.

"Leaving home is a way of establishing independence and is an important step in the transition to adulthood. However, young adults are tending to stay in the parental home longer than their parents did," the report says.

However, moving out to rented property has become a more attractive offer. The moribund housing market has brought an increase in the supply of rental properties, which has pushed down the costs for tenants.

Looking back

There is a hint of a lack of preparation for the economic downturn in the ONS figures, which reveal that a quarter of UK households had no savings in 2006-7.

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In general, people in the UK were better off in 2007 than they were 20 years earlier.

Average household net wealth per head in the UK more than doubled in real terms between 1987 and 2007, to reach an average of £113,000 per person.

However, debt levels seem to have kept pace. In fact, total household debt in the UK increased more than threefold between 1987 and 2007.

One survey quoted in the reported found that people were already finding it more difficult to manage with their income in 2007 than the previous three years.

But some still had relatively little inclination to save for the future.

In a poll from 2006-7, 60% of people aged under pension age felt that investing in property was the best way to save for retirement. However, only 8% owned any real estate other than the family home.

Two-fifths felt that they would rather have a good standard of living today than save for retirement.

"This feeling of 'living for today' was stronger among those with no current pension scheme," the report says.

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