House prices increasing at twice the rate of average wage, says report
03-08-2014
By tobymeyjes
The housing shortage is pushing up private rents and house prices, according to the National Housing Federation
The housing shortage in the South West is pushing private rents and house prices out of reach for local workers, according to a new report.
While the average wage rose by just 22% between 2002 and 2012, house prices have increased by more than twice as much (56%), according to the National Housing Federation.
The report, Home Truths 2013/14, blames the housing crisis on a shortage of affordable homes, with only 2,140 built in the West in 2012/13.
The average salary for the region sits at just £21,573, more than 11 times less than the average wage of £241,550.
Private rents increased by 35% over the same period, and are expected to rise a further 41% by 2020.
The report also showed that a gross annual income of £52,147 is needed for an 80% mortgage in the South West, with every new home built bringing in £77,314.
In the South West there has been a 108% increase in working people claiming housing benefit since 2009, and the third largest rise in housing benefit claims overall.
Jenny Allen, South West external affairs manager for the National Housing Federation, said: “High house prices, rising rents and low and stagnant wages across the South West region are not only making life extremely difficult for people living and working here, but they are also affecting employers and businesses and risk holding back economic growth.
“We need Local Enterprise Partnerships to work with local councils, housing associations and others to take a strategic lead on getting more homes built at the right price in the right places, which will help revitalise communities and create jobs.
“Local people also have an important role to play. Those who want more housing in the South West need to contact local councillors and say ‘Yes to Homes’.
“With more support, housing associations across the South West can be real catalysts for change for local communities. They are in it for the long term and can actively drive forward a balanced economic recovery.”