Homeowners typically have a gross annual income that is 29pc higher than that of private renters. Those on higher incomes also hold the bulk of the £180bn in additional savings British households accumulated over the pandemic.
The new dominance of fixed-rate mortgages will insulate the market from much of the immediate pain of interest rate rises, Mr Arnold added. In 2021, a fifth of mortgages were on variable rates, down from 70pc a decade earlier.
A rise in both outright homeownership and renting also means fewer households are exposed to the mortgage market at all. In 2005, 40pc of households had a mortgage, compared to 30pc in 2019-20.
Martin Beck, of the EY Item Club, said: “Interest rates have become a much smaller risk factor to house prices than unemployment.”
Unemployment is a key lead indicator for the housing market because it filters directly into forced sales. If people lose their jobs, they can no longer afford their mortgages and they have to sell up quickly. This is a looming risk as the prospect of a recession grows.
The Center for Economics and Business Research, a consultancy, has already forecast a technical recession, anticipating two consecutive quarters of GDP this spring and summer. It expects a corresponding rise in unemployment from the 3.8pc recorded in the three months to April, to 4.3pc by the end of 2022.
Mr Arnold said: “If a slowdown in the economy brings a rise in unemployment, that could trigger a decline in house prices.”
The cost of living crisis could also feed the wider housing market in other ways. If tenants cannot pay their rent, landlords could be forced to sell, which in turn could depress house prices, the report said.