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House prices: Welcome to the last affordable area of England


09-04-2014

 

There is only one remaining area of the country where house prices are less than three times the average national salary

CUMBRIA
 
LOCATION Workington
GUIDE £55,000
AGENT Auction House
 
A four-bedroom, three-storey house at this price? It?s true, but you must fight off competitive bidders at an auction on July 24. The big attraction is a spacious sitting room with a bay window, an original fireplace and Velux windows. It comes with a garage and a courtyard garden. This property would make an ideal buy-to-let or family home.
Homes in one local authority area of Cumbria, Copeland, are the last deemed affordable by the trade unions. 

According to a study by the Trade Union Congress, one in five local authorities were deemed "easily affordable" in 1997 with the cost of a home below three times earnings.

However, the federation of national trade unions has found that this number has now shrunk to just one area.

The combination of the housing market recovery across the UK and low wage growth since the recession means that areas which were traditionally accessible such as Oldham and Rotherham are now out of reach for many first-time buyers trying to secure a foothold of the property ladder.

The value of a home in Oldham, near Manchester, was 2.73 times salary in 1997, but is now up at five times earnings. Rotherham was 2.78 and is now also at five times salary.

Kensington and Chelsea has been brandished the most unaffordable place to live in the UK with the average home costing 32.39 times more than the average wage. Westminster and Hammersmith and Fulham came second and third respectively.

House prices in Copeland, which lies between the north-west coastline and the Lake District, are 2.87 times the average salary, Barrow-in-Furness is the second most affordable area with Burnley third, the analysis showed.

The West Cumbria area is home to nuclear re-processing plant, Sellafield, which provides thousands of relatively well-paid jobs to the area, pushing up average pay packets. The presence of the nuclear plant is a beacon of employment in an otherwise barren jobs landscape.

The area boasts impressive scenery, from Scafell Pike, England's highest mountain, to the Duddon estuary, a hidden gem where the river Duddon flows into the Irish Sea.

The study also revealed that 84pc of the UK now boast house prices at more than five times the local salary.

The eradication of cheap high value to income mortgages - the Bank of England has recently instructed banks to limit the proportion of home loans offered that are more than 4.5 times applicants’ salaries - will force more prospective buyers to continue renting.

"The toxic combination of rising property prices and falling real wages has meant that local housing affordability remains a huge problem for millions of people across the country," said Frances O’Grady, the TUC General Secretary. “We need an ambitious programme of home-building to get house prices back under control."

Only last week London-estate agent Foxtons flagged up a slowdown in the capital's house price growth and Nationwide issued a warning that future momentum in the property market is uncertain.

The lender reported on Friday that the national average house price is now £189,306.

www.telegraph.co.uk

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