Britain will be left with a "tiny elite and huge sprawling proletariat" who have no chance of "clawing their way out of a hand-to-mouth existence" in 30 years, a government adviser has warned.
David Boyle, a fellow at the New Economics Foundation think-tank, issued his stark warning as he predicted that rising property prices would effectively render the middle classes extinct as the dream of home ownership becomes ever more distant.
This group of Britons, which politicians have dubbed the "squeezed middle", would need to take three or four jobs just to make ends meet and no longer have time for cultural activities, according to Boyle.
Speaking at the Hay Festival, he predicted that the average house price would hit £1.2 million by 2045, forcing many young people to rent and be "in hock" to their landlord. Meanwhile, research showed that central London property prices have risen by £729 a day over the last year.
Boyle said: “The really scary thing is if in the next 30 years house prices rise as much as they have done in the last 30 years then the average house in Britain will cost £1.2 million."
“We cheerled the rise of property prices not realising that it would destroy, if not our own lives, but the lives of our children.
“The place where this is heading is a strange society with a tiny elite and a long struggling, straggling line which is the rest of us, a new proletariat, who will be in hock to Landlord PLC. We won’t own our own homes, we won’t be able to afford it.
“It will constrain our dreams and constrain the dreams of our children. It’s a new kind of economy where there are no middle classes at all.
“Nobody in society will have the kind of space in their lives, space in their homes, space in their careers for any kind of culture at all, because we will be having three or four jobs to make ends meet. I think it will impoverish society, make it more intolerant and make it more difficult to live.”
Boyle, who was commissioned to lead an independent review into access to public services for the government, said that the rising cost of living would end up polarising society.
“Very unequal societies are very inflationary societies and in the end it drives out those other degrees in society until it becomes very flat and very desperate," he said.
“You could say that it doesn’t matter and that a more classless society would be a good thing. I think if there is no place in the middle that anywhere can go to claw their way out of desperate hand to mouth existence, and the precariat, then that condemns us all to a precarious existence because there is no ladder.”
Meanwhile, the Office for National Statistics revealed that there has been a 25% increase in households with 6 or more people, and a 25% increase in unoccupied homes.
Dan Wilson Craw, spokesman for the Generation Rent campaign group, said: “Today’s statistics confirm that our broken housing market is creating deep divisions in society – wealthy property owners can afford to leave houses to stand empty, while more people who can’t buy are forced to squeeze into overcrowded private renting.
“The government has no hope of reversing this trend with a scheme like Help to Buy – the nation’s renters need better rights in the rental market if they want to live somewhere they can genuinely call home.”
The Bank of England has warned that the housing market boom could end in another crash, but governor Mark Carney has stood firm on his current plan to only start raising interest rates next spring.