24 August 2001
An income of more than £30,000 is required to buy an average-priced home in more than half of English counties, while in all but four London boroughs an income in excess of £40,000 is necessary.
The survey was carried out by the National Housing Federation, which is warning that demand for the government's starter home initiative, due to help house 10,000 key workers over the next three years, is likely to far outstrip supply.
In 18 English counties, the survey shows, a household with a 95% mortgage (where three times the salary is borrowed) would need to earn more than £40,000 to buy an average-priced home.
Although prices are highest in London and the Southeast, the problem is not confined to this area. In the East Riding of Yorkshire, a household would need to earn more than £24,000.
The federation is calling for subsidised rent schemes to be added to the initiative, first announced 18 months ago, as the average £25,000 grant available is unlikely to be enough to place average-priced homes within the reach of many key workers.
A £25,000 grant plus a mortgage worth three times a £20,000 salary would only allow an individual to buy a house for £85,000. An average-priced home exceeds this price in 86% of the country, including all of the area Southeast of a line drawn between Bristol and the Wash.
Liz Potter, the NHF's policy director, said the high cost of housing is putting the delivery of essential services at risk.
She also criticised the time taken to get the £250m initiative under way: 'We had hoped that at this stage we would have been looking to expand the initiative, and not still waiting to get it off the ground.'
PFaug2001
