City house prices now six times the average salary

The Riverside View housing development on Luneside West, which consists of Redrow and Barratt Homes.
The Riverside View housing development on Luneside West, which consists of Redrow and Barratt Homes.

Lancashire is cracking under the pressure of several widely different broken housing markets according to a new report.

In Lancaster, the average cost of a home – £153,635 – is now six times higher than the average wage - £25,635.

In some areas a chronic shortage of homes has seen housing costs spiral out of reach for many families, while in other parts of the county communities are struggling in desperate need of jobs and regeneration, according to the National Housing Federation.

The North West Broken Market, Broken Dreams report reveals the extent of the fragmented housing crisis across Lancashire.

Despite house prices being below the national average in Lancashire at £153,152, prices are still beyond the reach of local pay-packets.

The average salary for people in Lancashire of £23,972 doesn’t come close to the £35,006 required for an average mortgage in the region, pricing thousands of workers and families out of owning a home.

While some high demand areas are suffering from a housing shortage, there are also places in desperate need of regeneration and pockets of poor quality older homes which don’t meet the housing needs and aspirations of local people.

The report highlights how house prices reflect local economies which vastly differ across the whole of the North West, with unemployment ranging from 12.1 per cent in Liverpool to 2.6 per cent in Eden. But it’s not just those out of work who are struggling to afford to keep a roof over their heads. In the North West 17.4 per cent of all households claiming housing benefit are in work, a proportion which has more than doubled since 2008.

The report predicts that over the next 20 years, 360,000 new households are expected to form in the North West and if properties aren’t brought back into use or enough new homes aren’t built the region will face a shortfall of 195,000 homes by 2031. This means the cycle of rising housing costs will continue for the next generation.

Every new affordable home built in the North West adds £90,972 to the regional economy and creates 2.1 jobs.

Katie Teasdale, external affairs manager for the National Housing Federation in the North West, said: “We are seeing a divided picture in the North West, with strong confident cities needing a housing offer which matches their growth ambition.

“In some places spiralling costs have put housing out of reach of many people. In other places we see communities that are struggling - in desperate need of jobs and regeneration. We need to sit down with local leaders to make sure that good quality accessible housing sits alongside skills, jobs and transport. It’s taken us a generation to get into this housing crisis and will take us a generation to get out of it. Successive governments have failed to tackle the country’s major housing challenges and we are calling on the next Government to commit to end the housing crisis within a generation.”