The ONS annual ‘housing affordability’ statistics published
today, show:
· A
typical home in England now costs a staggering eight times the
annual earnings of the average full-time worker. And for workers
on a lower income, the gap between average house prices and wages
is even more dramatic at 11 times.
· In
the last five years, every region of England has become less
affordable. Predictably, housing affordability has worsened the
most in London, where average house prices have risen
six times faster than earnings. But the capital is
closely followed by the East and South East of England where
they’ve risen more than four times as fast as wages (see Figure
1).
· Decades of failure
to build enough homes have led to house prices rocketing by 268%
in the last 20 years (from £65,000 in 1998 to £239,000 in
2018) while average annual earnings grew by just 69% (from
£17,709 to £29,872). So it’s hardly
surprising that the number of private renters
has nearly doubled over the same
time period, from 10.3% to 19.5% of all
households, as homeownership has slipped
further out of reach.
Polly Neate, chief executive at Shelter,
said: “Today’s figures leave us in no
doubt that owning a home is an all-but-impossible dream for
millions of working families. Combined with the dire lack of
social homes, this has left huge numbers of people with no choice
but to rent privately.
“It cannot be right that so many families, especially those
on lower incomes, now face a lifetime in deeply unstable private
renting, where they’ll have to pay well over the odds to keep a
roof over their head.
“More families desperately need the option of social
housing, and they need it now. To make this a reality, the
government must back our call for 3.1 million more social homes
over the next 20 years. Only by doing this will we solve our
housing crisis, and finally give people the chance of a truly
stable home.”
ENDS
Figure 1 - Please contact us for a higher res version
Notes to editor:
· Data
is taken from the Office for National Statistics (ONS) Housing
Affordability in England and Wales 2018 statistical
release.
· Housing
affordability is calculated by dividing house prices by annual
earnings.
· The
typical house price refers to the median price paid for
residential properties in England.
· Earnings
data are from the Annual Survey of Hours and Earnings (ASHE) and
refer to median workplace-based gross annual full-time
earnings.
· Lower
income earnings describes the lower quartile of workplace-based
gross annual full-time earnings.
· Change
in median house prices and median earnings is 2018 data compared
to 2013 data.
· The
proportion of households renting privately can be found in the
English Housing Survey 2017-18, Annex Table 1.1 Trends in tenure,
1980 to 2017-18.
