A growing number of young households do not have enough money to buy even the cheapest properties in their area, but they are not entitled to housing benefits because of their high earnings. This was revealed by a study carried out for the Joseph Rowntree Foundation. It has found that over one million young households in the UK can't afford the cheapest local houses.
Professor Steve Wilcox of the University of York, the author of the report, said the research has identified "a yawning gap" in the market for affordable homes. And each year, an estimated 60,000 young households join this bracket in England, Wales and Scotland. House price inflation was much higher at 5.6 per cent for first-time buyers when compared to owner-occupiers, whose annual increase was at 1.8 per cent.
The study found that two million people under 40 are caught in this trap of "intermediate housing ". The report identifies 40 districts where over 40 per cent of younger households can't afford even ten per cent of cheapest houses of 2-3 bedrooms. Their proportion was reportedly highest at 50 per cent in the most expensive boroughs of Bournemouth, South Buckinghamshire along with Kensington and Chelsea in London. In 33 districts, local property prices are more than five times higher than the average income for young working households.
According to estimates, just under a fifth of households across the UK aged under 40 are beset by the problem. And the number rises to one in three in London, the south-east and south-west of the country.
Lord Richard Best, director of the foundation, while acknowledging the initiatives by launched the government to increase housing affordability, said more comprehensive measures were the necessity of the day. "If large numbers of households are not to miss out on the benefits of home ownership, then much greater efforts - and probably much more public money - will be needed to give them a break,” he added.
It also found that there is a serious shortage of moderately-priced rentals in the United Kingdom.
Posted
on : Tue, 11 Oct 2005 16:05 GMT | Mortgages News
By : Pippa Fielding
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