Workers need to double their salary to pay for first home in East Anglia
- Credit: Archant
The average worker in Essex and Suffolk would have to more than double their current salary to afford a typical mortgage, according to “frightening” new figures.
The research by the National Housing Federation (NHF) has revealed the scale of the challenge facing first-time buyers struggling to climb on to the property ladder and highlights the impact as increases in house prices continue to outstrip stagnant wages.
Average property values are worth almost 11 times more than annual salaries in parts of the two counties, the research has shown. Emmerson Dutton, partner at Bedfords Estate Agents, which has offices across East Anglia, said: “When I bought my first house 20 years ago, my income was 40% value of the house. Since then, it is absolutely frightening how house prices have continued to escalate, regardless of the recession.
“This is going to carry on. We have got willing tenants who are unable to buy and we are finding ourselves with a split in society.
“House prices in East Anglia have risen by 5-8% annually recently and wages have been far below that for some time. The average worker has to live in below-average accommodation, which seems unfair.”
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Ten years ago, 59% of 25 to 34 year-olds owned their own home in England. That figure has now fallen to 36%. The proportion of the same age group renting from private landlords has risen from 21% to 48% in the same time.
“A couple earning the minimum wage would not be able to afford that. They would have to raise their income or lower the property price.”
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Claire Astbury, external affairs manager for the East of England at the NHF, warned:
“It is becoming increasingly clear that without drastic action, we run the risk of being unable to house our children.
“There is no solution to this crisis that does not involve the building more homes and eliminating the shortfall that saw over 60,000 fewer homes than needed in the region that were built over the past four years.
“Housing associations are key partners for government as we seek to work together and end this crisis for good.”
A spokesman for the Department for Communities and Local Government added: “We want to help anyone who works hard and aspires to own their own home to turn their dream into a reality.
“Government initiatives have helped more than 230,000 people to buy since 2010, and we are delivering 200,000 new starter homes, which will be available at a 20% discount to first-time buyers.
“We have got Britain building again, with the latest figures showing a 25 per cent rise in the number of new homes over the past year.”