Northern house prices to rise 60 per cent by 2011
Thursday, 05 Oct 2006 10:02
A housing crisis is predicted in Yorkshire & Humber if more affordable housing is not built (photo: pixmedia)
Homebuyers in Yorkshire & Humberside should expect the average house price in to rise 60 per cent to £220,000 by 2011, a new report reveals.
The research, commissioned by the National Housing Federation, the Chartered Institute of Housing and Yorkshire and Humberside Housing Forum, has been labelled a "timebomb" due to affordability and supply issues.
The rapid growth for Yorkshire and Humberside is faster, in percentage terms, than the national average - benefiting current homeowners and the regional economy, but preventing first-time buyers getting on the property ladder.
The price rises in the region are particularly sharply felt as Yorkshire & Humberside's average income levels have not risen at anything like the same rate as property prices.
In 1998 the income to house price ratio was 3.4, whereas this year it stands at 6.6, the report finds. In actual terms, the average salary in the region is £21,014, but researchers estimate to afford a mortgage homebuyers need to be earning £38,000.
The report predicts this gap will continue to grow year on year.
Jane Evison, of the Yorkshire and Humberside Housing Forum, commented: "We have the evidence here to demonstrate to government that affordability is not just a southern issue. We will be making a strong case to government as part of our submission to the [government's] comprehensive spending review for the appropriate resources and policy tools to be able to deliver much needed affordable homes across the region."
Also highlighted in the report is a split in the housing market, with average house prices in some locations almost four times the price of the cheapest areas.
Julie Gamble, of the National Housing Federation, said: "The figures revealed today make clear that much more needs to be done in this region to turn these two housing markets into one. We need affordable homes in the areas seeing a rapid rise in prices and continued support to renew the housing market in the more deprived areas of the region.
"It is vital that through the comprehensive spending review 2007 the government make housing a top priority for increased investment."
Around 4,500 to 5,000 new affordable homes are needed to prevent the housing crisis in the region, according to the report.
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