Housing waiting lists in the North West have risen 75% in the last five years, more than any other region according to a new report from the National Housing Federation.
Home Truths 2008 - North West reveals that 212,600 households or close to half a million people are waiting for social housing in the region.
Despite recent falls in house prices, affordability remains a major problem throughout the region. House prices have risen over 80% in the last five years, well above the national average of 58%. On average homes in the region now cost almost 9 times incomes. The credit crunch means banks are demanding much higher deposits and with a hike in interest rates first time buyers face yet more misery.
House prices may currently be dropping in the region but affordability for first time buyers is not improving. The gross annual income required to get a mortgage for the average house price is in excess of £43,400, more than double the actual average income. This is based on a 95% mortgage of 3.5 times the income, which used to be standard but now is almost impossible to find.
The document contains the latest forecasts from Oxford Economics showing that despite a further fall in house prices in 2009 and 2010 we face a period of rapid rises from 2011 to 2012. The average house price in the region by 2013 will be over £195,000 more than 22% higher than today. During these turbulent times it is always difficult to predict what lies ahead and the housing market could face a more severe slump if the world wide economic crisis worsens.
The report also shows:
- Social housing stock in the region has fallen 10% in the last five years, more than double the national average.
- Housing transactions are down almost 40% in a year, from 12,360 in April 07 to 7,498 in April 08.
- Nearly 11,400 households were accepted as homeless in the region last year.
- Eden and South Lakeland in Cumbria both feature in the top 20 locations in the country for second and holiday homes and the 40 most unaffordable places in the country for younger working households to buy a home.
Across the region:
- Cheshire house prices are almost 11 times average incomes. Over 18,800 households are on waiting lists but only 307 new social homes were provided last year.
- Cumbria house prices are 10 times average incomes. Over 13,000 households are on waiting lists but only 153 new social homes were provided last year.
- Greater Manchester house prices are 8 times average incomes. Over 87,500 households are on waiting lists but only 630 new social homes were provided last year.
- Lancashire house prices are 8 times average incomes. Over 24,600 households are on waiting lists but only 246 new social homes were provided last year.
- Merseyside house prices are 8 times average incomes. Over 40,600 households are on waiting lists but only 800 new social homes were provided last year.
Sallie Bridgen, National Housing Federation North West regional manager said:
"Across the North West housing supply is not meeting demand. The region has seen the greatest rise in demand for social housing over the last five years with close to half a million people in the region now on a social housing waiting list. House prices have risen much faster than the national average since 2003, making home ownership unattainable for most first time buyers.
"Dropping house prices bring no relief, borrowing conditions are much stricter, housing transactions in the region have tumbled and more people are now turning to housing associations for help."
"Following the current economic downturn we predict further rapid rises in house prices similar to those of the past five years. This may offer some relief for current home owners but means yet more misery for those looking to get on to the property ladder."
"We may be operating in a different economic climate but the urgent need for new social homes remains as great as before. It is time for the Government to be radical to deal with the changed market. If we get this right, housing associations could be in a position to lead the recovery in house building."
The Federation applauds the Government for committing to implementing the mortgage rescue scheme devised by the Federation and the Council of Mortgage Lenders. However more can be done and the Government must:
- Increase public investment to support the building of new high quality family housing for social rent.
- Make public land available to housing associations at discounted rates.
- Bring forward the entire social house building budget for 2008/9-2010/11 and make it available for housing associations so they can use it for house building now.
- Support housing associations in buying unsaleable private developer homes of an appropriate standard.
Ends
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