Almost a third of young working households are finding it impossible to get on the bottom rung of the UK housing ladder.

That is according to new research from housing intelligence business Hometrack, which finds 28.3 per cent of younger buyers are unable to secure a property in their local area.

Unsurprisingly, the largest proportions of young working households unable to access the housing market are in London (41 per cent) and the south-west (40 per cent).

Historic house price growth, coupled to more recent affordability pressures on first-time buyers as food and fuel price hikes stretch budgets, has resulted in average mortgage costs for this group increasing 12 per cent over 2007 alone.

Hometrack now argues the mortgage cost to earnings ratio for a first-time buyers now exceeds the previous peak some 34.1 seen in 1990.

The level increased to 34.5 per cent in 2007.

Making matters worse for potential first-buyers is the increase in average rental costs. As purchases are delayed amid uncertain market conditions, demand has increased, forcing prices skyward.

As Richard Donnell, Hometrack’s director of research, explains: “The extra cost and general market uncertainty is driving would-be purchasers into the rental market where renting is currently cheaper than buying – this was not an option in the late 1980s as the rented sector did not exist in its current form.

“However rental affordability is likely to worsen in the coming months on the back of rising rents which are up by as much as 20 per cent in some markets over the last year.”

Yet, the cost of renting remains substantially lower than buying according to Hometrack. Nationally the cost of renting is just 68 per cent of the cost of buying a typical two or three-bedroom property.

“While house prices are falling, access to the property market is being increasingly limited by the costs and more restrictive terms of a substantially reduced supply of mortgage finance,” explained Steve Wilcox of the University of York, who carried out the research.

“Without further measures to restore the availability and accessibility of mortgage finance there is the risk of a severe downturn, with all the harmful consequences that this entails.”