Unaffordable homes price buyers out of the market

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No area of central Lancashire is “easily affordable” for homebuyers, according to latest research TUC analysis shows that in Preston, South Ribble, Chorley, Lancaster, West Lancashire and the Ribble Valley, the average house price is more than 4.5 times the average salary limit.

Ribble Valley has been revealed as the most unaffordable area, with government figures showing the average house price is 7.76 times the area’s average salary of £22,787.

But experts predict the situation could be worse than thought, saying the true average house price in the Ribble Valley they are witnessing is much higher than the £176,827 figure used by the Government.

House selling website Zoopla states that the average asking price for houses in Ribble Valley is currently £246,962.

Angela Lofthouse of Ribble Valley-based estate agency Anderton Bosonnet, said: “Prices in the Ribble Valley have always been steep, but they seem to be creeping up even more at the moment.

“The type of house we sell most of is semi-detached, and they’re all at least £200,000.

“I think one of the main factors why prices are high in the Ribble Valley is that we have really good schools around here and people want to move into the catchment areas. We get quite a lot of people from the South looking to relocate here for that reason, and also because it’s a very pretty and nice area to live.”

As reported in the Evening Post last week, a report has found that parents in England pay a typical premium of nearly £21,000 to live near to one of the country’s top state schools.

House prices near to Clitheroe Royal Grammar School have the third highest percentage premiums, being £86,857, or 62 per cent more expensive than those in Lancashire generally.

Angela said the Government’s move to tighten up lending in April has slowed down interest in some homes, as prospective buyers are put through two to three-hour-long interviews to check affordability and clamp down on reposessions.

She said: “There’s a big demand for affordable homes in the Ribble Valley, so when we get them they fly out, particularly those with three bedrooms which are suitable for young families and young couples. But quite often, they choose to rent because of prices, and we’ve seen a big demand on our lettings side.”

In comparison, no area in the North West had a ratio of more than four in 1997, with many, including Preston, Lancaster and South Ribble at that time falling under three, deemed ‘easily affordable’. Although Lancashire house prices are yet to surpass pre-crisis peak levels - still currently nine per cent down on the peak of the market - the TUC say the issue is compounded by falling real wages. Recent analysis by the union found that pay packets in the North West fell by around £42 a week in real terms between 2010 and 2013 – a fall of eight per cent.

North West TUC Regional Secretary Lynn Collins said: “We have seen a huge shift in the North West, from a region that contained no area where houses prices were out of reach to local people to one in which almost half now are.

“In 16 years, we have gone from having 21 areas with house prices that are easily affordable to none. Property price rises have outstripped peoples’ pay packets and left huge swathes of the region unaffordable. We need to start implementing solutions to fix this problem.

“We need to build more homes to get house prices back under control. With interest rates low, now is the perfect time for an ambitious programme of home-building, which would also help tackle local unemployment problems. But as more people give up on buying a home or decide they don’t want to get on the housing ladder, we also need a better deal for renters so that they don’t get clobbered by soaring rents.

“Housing affordability isn’t just about house prices though. Decent wages are just as important and there is a lot of ground to make up before we return to the kind of salaries that people were earning before the crash. As we’ve seen in recent weeks, problems still persist due to issues like the public sector pay freeze and workers paid below the living wage.”

Ribble Valley MP Nigel Evans said: “I have been aware for a long time that house prices in the Ribble Valley are a lot higher.

“It’s a great place to live - we have the lowest level of crime in the country, there is not a single bad school, we have fantastic pubs and restaurants and fantastic small villages, so you can see why the pressure is there.

“There are two ways of tackling this problem - the first is to ensure that there is sufficient affordable housing as a proportion of new housing stock, and that surrounding areas recieve enough regneration money for improvements to services, to also make them attractive.

“There is a difficult balancing act though, regarding building more homes in the Ribble Valley. If we were to carry on building more and more homes until prices started to fall in the area, then we’d be destroying the reason why people want to live here in the first place.”

He added: “It’s always been the case unfortunately that young people can’t always get on the housing ladder in the places where they grew up. All that’s happened is that it’s got worse. Twenty or 30 years ago there might have been a bit of a chance, but now people are having to live longer with their parents or move out of the area. We have to use the tools we’ve got, and the regulations must ensure that affordable homes go to local people first - they would be fury if we discovered the stock was going to people from well out of the area first.”