England Homes Increase More Than Three Times The Rate Of An Average Salary
|The cost of buying your own home in England increased by more than three times the rate of an average salary over the past ten years – leaving millions of people out of reach of ever getting on the housing ladder.
National Housing Federation research found that in 2001 the average price of a home was £121,769, and the average salary was £16,557. In the space of ten years the price of a home has rocketed to £236,518 – an increase of 94% - whereas wages have risen just 29% to £21,330, making buying a home increasingly unaffordable for millions of workers.
Saving for a mortgage has also got a lot harder with the amount of deposit needed to get a mortgage rising by 386%. In 2001 the deposit for a typical 90% mortgage (available in 2001) was £12,177, about nine months salary. By 2011 the amount banks were willing to lend was less, and so the deposit needed for a typical 75% mortgage leapt to £59,129, almost three years salary.
In 2001 the ratio between average house price and salary was 7.4, but by 2011 that had risen further to 11.1. Regional variations show even greater gaps with the biggest change in Copeland, where house prices rose by 145% and incomes by just 5%.
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David Orr, chief executive of the National Housing Federation, said: "These shocking figures show that it is getting increasingly harder for millions of people to buy a home of their own in the current climate.
"With the gap between income and house prices growing ever wider, people can often feel like they have to win the lottery to be able to buy in their local area.
"A shortage of homes means the price to buy them is being pushed ever higher by the market, and out of reach of millions of hard working families. Unless we start building more homes people can truly afford to match the demand, this will only get worse."
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