New report shows over 80% of homes are unaffordable for first time buyers

By agency reporter
June 25, 2014

New research from the housing and homelessness charity Shelter shows more than 80 per cent of properties for sale in England are unaffordable for the average working family looking to buy their first home.

Shelter says that in over half of the country, fewer than one in ten suitable homes on the market were affordable for a typical family, even assuming they were able to save the average deposit for a first time buyer.

For those hoping to buy with smaller deposits, the situation is even worse with 88 per cent of homes for sale in England unaffordable for families with a 95 per cent loan.

The research paints an alarming picture of England’s affordability black spots. In 83 local authority areas, which accounts for over a quarter of the country, there were fewer than 10 affordable homes for sale. These areas included Cambridge where there were only three affordable homes for sale, and Brighton and Hove where there was just one. Alarmingly, in 14 local authority areas, including Ealing, Lewisham and Slough, there were no affordable homes for sale at all.

Campbell Robb, chief executive of Shelter, said: "When a family looking to buy their first home searches a whole town for a place to live and finds nothing they can afford, it's clear we’re not just facing a housing shortage any more: it’s a full-blown drought."

This chronic shortage of affordable homes is not confined to London and the South East, says Shelter. In Exeter only one per cent of homes on the market were affordable for the typical family (eight out of the 553 for sale) whilst in South Lakeland in the North West only four per cent were affordable (43 out of 1,069).

As higher monthly mortgage costs push even more homes out of reach, single people have the least chance of getting a foot on the property ladder, with only seven out of every 100 homes on the market affordable for someone on an average wage.

Even couples without children, who have two full-time incomes are likely to struggle. In a quarter of the country, fewer than ten out of every 100 homes for sale were affordable for a childless couple on average wages.

Recent government figures show that average house prices in the UK have risen by 9.9 per cent in a year to £260,000 – higher than their pre-crisis peak in 2008. With soaring housing prices and the lack of affordable homes beginning to take effect, official figures show that home ownership in England has fallen to its lowest level since 1987.

"Our failure to build more homes is leaving a whole generation of young people with no choice but to remain trapped in expensive and unstable private renting, or stuck in their childhood bedrooms for years to come, no matter how hard they work or save", said Campbell Robb. "What we need right now is for politicians to roll up their sleeves and make stable homes for the next generation a top priority."


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