Britain has changed since 1998.

Back then, it only took workers about three years to save enough money for a down-payment on a house. Now it takes 20 years, on average, according to the Resolution Foundation, which published a landmark report on income, housing, and inequality in Britain last week.

In a series of easy-to-understand charts, RF data show that income growth for workers is stagnating while housing costs are rising.

That double-whammy — housing costs and stagnant wages — are now the major source of inequality in Britain.

It is tough to understate how radically this has changed the country. In 1998, most people had a shot at owning their own home. Now a full half of the population — younger people, mostly — have almost no chance of buying property.

That has created two classes in Britain: property owners and people who are getting poorer. And, of course, the poor are largely paying rent to the rich.

Here is how it happened.

Current employment data looks really good. This should be the best of times because the UK is technically at full employment. So what is the problem?

Weekly wages have gone down significantly in the last 10 years. People have jobs, but the jobs are worse than before. Self-employment is getting worse.

Resolution Foundation

The growth in all our incomes is in decline, but especially for people in work.

Resolution Foundation

At the same time, rents and house prices have climbed aggressively, especially in the South. But earnings growth (in green) has been only modest.

Resolution Foundation

Between 1998 and today, the Bank of England lowered interest rates from nearly 8% to close to zero. That made mortgages increasingly cheap and easy for buyers to obtain. All that cheap money fueled demand for 18 straight years, putting upward pressure on housing prices. (You can see a chart demonstrating this here and a similar one showing the same phenomena in Sweden here.)

The cost of housing is so now high it is making people who have jobs poorer. On this measure, people with jobs are poorer today than they were in 2006.

Resolution Foundation

Here is another way to look at the high cost of housing: It now takes 20 years for the average worker to save enough for a deposit to buy their own home. Back in 1998, it only took three years.

Resolution Foundation

The Gini coefficient is an index that measures how extreme inequality is in a society, with zero being perfect equality and 1 being extreme inequality.

Housing costs are so high they are exacerbating inequality, which would have decreased if rent and mortgage payments were lower.

Resolution Foundation

It will get worse. The current government has adopted tax and benefit policies that will make rich people richer, and poor people poorer, over the next five years.

Resolution Foundation

Based on the available data, the bottom 40% of Brits are set to become significantly poorer in the next five years while the wealth of everyone else grows only slightly.

Resolution Foundation

It's not a problem for the 1%, however. They're taking an ever-greater share of the national income.