The Migration Watch UK think tank says high levels of net migration have been behind the soaring demand for rental properties over the past decade. 

As a result, they say, people are paying sky high rents which in turn make it near impossible for millions to save for a deposit.

Lord Green of Deddington, chairman of the campaign group, said: “The Government is in denial about the massive impact of immigration on the housing market. 

“While the older generation have been able to sit back and watch their properties shooting up in value, it is younger people who have mainly suffered the consequences with sky high rents and little prospect of owning their own home. This is frankly indefensible. The time has come for firm measures to address the demand for housing as well as its supply, and to acknowledge and deal with one of the main drivers of demand for housing. Otherwise, we will not only fail to meet demand but our young people will continue to bear the brunt of the housing crisis.” 

The Migration Watch UK report claims privately rented homes with foreign-born heads now account for a third of all households in the sector, up from around a fifth in 2000. 

As supply has failed to keep pace with the rise in demand, rents in England have risen by 23 per cent over the past decade, they say.

London is bearing the burden of ballooning demand for rental properties which, the campaign group claims, has largely been driven by unprecedented levels of net migration.

Analysis shows that homes headed by those born abroad accounted for more than 80 per cent of the total growth of households in London’s private rented sector over the past decade. 

Over the same period, rents in the capital have increased by 36 per cent, significantly more than the 21 per cent rise in average earnings between January 2008 and January 2017.

The report states: “The fact that immigration is a major component driving the demand for homes across England is often ignored or downplayed by many commentators and politicians. This is all the more indefensible given that, during the last decade, more than 90 per cent of additional households in England had a foreign-born head.”

ONS figures show that of the net change in the number of households in England of just over 1.2 million between 2005-2014 more than 1.1 million had a foreign-born head.

Meanwhile, housebuilding across the UK has averaged averaging only 130,000 a year in the past ten years. 

The report also suggests the higher cost of purchasing a property has contributed to an increase in the number of young people being forced into the private rented sector, finding the share of 25-34-year olds in England heading privately rented homes has nearly doubled over the past decade, while the proportion of owner-occupiers in the same age bracket fell from 57 per cent to 38 per cent during the same period.

Meanwhile, official estimates suggest that over 25 years up until 2039 there will be an average increase of 210,000 households a year in England. 

The Department for Communities and Local Government (DCLG) said that of this figure 133,000, or 63 per cent, would be down to the existing population and only 77,000, or 37 per cent, would be the result of future net migration.

But Migration Watch UK believes this is fundamentally wrong because the level of immigration on which the projection was based is significantly too low.

It claims the Government’s projection is based on net migration to England of just 170,500 a year when the figure is currently 300,000 a year and has averaged 200,000 a year over the past decade.

Net migration - the difference between people coming to the UK and those leaving - fell by nearly a third to 230,000 in the year to June. 

But it is still short of the Government’s target to reduce net migration to the “tens of thousands”.