House Prices Hit Record ‘Unaffordability’

There are many incentives to choose to self-build your own timber frame house, but not least of them is pricing in the current housing market. House prices continue to rise ahead of earnings, however, it’s now been revealed that they have hit record levels, meaning that buyers have to fork out eight times their salary for the average house, according to The Independent.

The Office for National Statistics found that the average house price rose by 4.5 per cent in 2017, now sitting at £225,000. In comparison, annual earnings only grew by 2.1 per cent, to an average of £28,952. This pushes the ratio of earnings to house price up to 7.77 – the highest tin the official time series.

Of course, banks and building societies will usually only lend up to 4.5 times salary, meaning that for many people, owning a house is unaffordable outside of pooling salaries as a couple.

In London, the situation is even worse, as buyers will need to fork out 13.24 times their annual salary, up again year on year. However, in the North East, houses cost just 5.15 times salaries, making it one of the most affordable places in the country to buy a home.

Home-ownership has fallen 10 per cent in the last 10 years, and in London especially, there are concerns that housing issues are forcing employees to quit jobs, making recruiting difficult for many firms. At present, more people than ever are expected to rent throughout their entire lives, and it’s not necessarily believed that more housing being built will change this situation alone.