East Midlands house prices have risen by 12% since 2008 to seven times the average salary
House prices in the East Midlands have increased by 12% since the 2008 economic crash according to a new report from the National Housing Federation.
Home Truths 2016/17, which provides local data on the housing market in the region, revealed an increase in prices from £169,300 to £189,000, taking them to seven times the average salary.
The report shows that the typical salary in the East Midlands is below the national average at £26,000, but the income required for an average mortgage is £43,000, pricing many people out of home ownership.
South Northamptonshire tops the list as the most expensive area in the region to buy a home, with the mean house prices at £308,570, 10.2 times the average salary. Also in the top five most expensive areas to buy a home in the East Midlands are Rutland, Rushcliffe, Daventry and the Derbyshire Dales.
Bolsover is the cheapest area to buy in the East Midlands with a mean house price of £128,879, which is 5.8 times the average salary.
It is joined by Mansfield, Ashfield, Nottingham and Lincoln in the five least expensive areas in the region to buy a home.
The cost of renting privately has also added pressure on people’s income with average monthly rents now standing at £600. In some regions this goes up to £800 a month, swallowing up to 27% of private renters’ income.
The report also reveals that nearly 29,000 too few new homes have been built over the last five years in the region. Last year alone, fewer than 14,000 homes were built, far below what is required to accommodate the 17,000 new households that are formed each year.
In addition to this, the number of households aged 65 and over is expected to grow by 58% from 573,000 to 903,000, between 2014 and 2039. In contrast, households aged under 35 are expected to increase by only 1%, from 330,000 to 333,000.
Emma Foody, external affairs manager for the National Housing Federation in the East Midlands, said: “The overall story in England since the economic crash in 2008 has been one of general recovery and success. However, the housing market has seen a relentless rise in the gap between house prices and people’s salaries, and the West Midlands are no exception. Attaining a mortgage is increasingly unrealistic and private sector rents make saving up that bit more difficult.
“As this year’s Home Truths report shows, it is more important than ever for the sector to be able to deliver homes that are truly affordable. Housing associations are working hard to develop an “offer for everyone” – whether that’s social housing or ownership options so that no one is priced out of home ownership. They are a vital part of the solution to the housing crisis and are ambitious about delivering even more houses.”