WIREDGOV

Copeland in the Lake District is the last local authority area left in England where the average house price is less than three times the average annual salary, according to new analysis published today (Monday) by the TUC.

The TUC analysis of average (median) salaries and house prices by local authority area shows that in 1997, around one in five local authority areas were ‘easily affordable’ with average house prices less than three times local median earnings.

Over the last 16 years the number of ‘easily affordable’ local authority areas across England has fallen from 72 to just one – Copeland in the Lake District. However, house prices in neighbouring South Lakeland are now eight times the average local salary – showing that the rest of the Lake District is by no means an affordable area to live, says the TUC.

The TUC research shows that there are no longer any areas in the South of England (the South East, South West, London and the East of England) where average house prices are any less than five times the average wage.

To date, the debate around housing affordability has centred on London and the South East. But the research shows that areas across the country – from Rotherham to Norwich – are becoming out of reach for local people as the combination of rising house prices and low wage growth mean it’s set to get even harder for them to get onto the local housing ladder.

Back in 1997, around one in ten local authority areas were ‘out of reach’ – with average house prices more than five times local salaries. However, over the last 16 years, the number of ‘out of reach’ areas has increased eightfold, with 84 per cent now having house prices at more than five times the local salary. The affordability ratio of five is particularly significant, says the TUC, as the Bank of England has recently instructed banks to limit the proportion of mortgages they offer that are more than 4.5 times applicants’ salaries.

The TUC research shows that property prices in many of the UK’s previously ‘easily affordable’ areas are becoming out of reach for local people. In areas such as Stockton-on-Tees, Boston and Luton, house prices are now more than five times the average salary.

All of the top five least affordable areas of the country are in London. The Royal Borough of Kensington and Chelsea is top with average house prices more than 30 times the average local salary. Elmbridge in Surrey is the least affordable area outside London with an affordability ratio of 14.3.

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