One in five people in the West Midlands could be renting from private landlords by 2025, according to new research.
Patterns of home ownership in the region are changing with continued growth in private renting expected over the next ten years, according to the analysis by financial services firm PwC.
The data suggests that in the year 2000 only seven per cent of people were renting from private landlords but by 2025 this could rise to 20 per cent.
In 2000, almost 70 per cent of people owned the home they lived in - either outright or with a mortgage - with around 30 per cent renting from either private landlords or the social sector.
The report shows that, by 2025, only around 62 per cent will own their home in the West Midlands and around 38 per cent will be renting from either private landlords or in the social sector.
Previous research published last year by PwC highlighted the rise of private renting across the UK, particularly among 20 to 39 year olds and predicted its continuation throughout the next decade.
The trend in the West Midlands is similar to other regions and countries within the UK, which are expected to experience falling levels of home ownership and rising levels of private renting over the next decade.
The Midlands, North and Scotland are expected to see faster growth in private rentals than the South, excluding London.
These areas are starting from a lower base level and the marked declines in the social rental sector seen historically will continue, albeit at a slower rate.
Richard Parker, partner in the housing sector team at PwC in the West Midlands, said: "A number of factors are driving this predicted shift in tenure within the housing sector.
"These include a lack of new housing supply to meet demand, mortgage deposits requiring savings that are well out of the reach of first time buyers and younger people increasingly showing a preference for rental housing.
"We're now seeing a growing number of investors putting significant funds into the development of quality, private market rental accommodation, which they are increasingly viewing as a long term revenue stream.
"While house builders have had to factor both affordable home ownership and low cost rent properties into their development plans to date, the likelihood is that, as a result of the new housing and planning bill, we will now see a shift towards the development of starter homes for sale rather rather than properties for rent in the years ahead."
