Andy Sommerville, Director at Search Acumen, comments:
“Today’s statistics reveal that the typical price paid for residential property in England and Wales increased by 259% between 1997 and 2016 – an obviously significant jump over nearly two decades. On average, working people could expect to pay around seven and a half times their annual salary when purchasing a home in England and Wales last year, up from around three and a half times their earnings twenty years ago. Evidently, the 21st century has seen home-ownership pushed far into the distance for many young professionals but we are now in danger of ‘Generation Rent’ encompassing house hunters of all ages.
“The huge gap between earnings and affordability is extremely worrying. Prospective buyers are more stretched to buy property in every single local authority than they were before the turn of the millennium. It is not simply the fault of wages, it is down to the gaping hole between demand and supply in our property market.
“Various policy announcements over the past months have given some reassurance that this is on the government’s agenda, however Philip Hammond’s radio silence when it came to housing in the latest Budget led to some criticism from the industry. It is now up to the construction industry and the mortgage lenders to kick-start the recovery of our problematic sector and pave the way for a healthier and sustainable housing market.”
You can read about the ONS housing affordability statistics for England and Wales: 1997 to 2016 here.