West Mids house prices rise three times as much as incomes over 10 years

The cost of buying your own home in the West Midlands increased by more than three times the rate of an average salary over the past ten years – leaving thousands of people with no hope of ever getting on the housing ladder.

National Housing Federation research found that in 2001 the average price of a home in the West Midlands was £95,015, and the average salary was £15,636. In the space of ten years the price of a home has rocketed to £171,707 – an increase of 81% - whereas wages have risen just 25% to £19,531, making buying a home increasingly unaffordable for thousands of workers.

The West Midlands has seen a 45% increase in the gap between house prices and wages between 2001 and 2011. The 10 worst affected areas are:

1. Staffordshire Moorlands: House prices up by 94% (from £80,681 to £156,304) where wages have only increased by 5%, meaning the gap between house prices and wages has risen 84% between 2001 and 2011.

2. South Staffordshire: House prices up by 79% (from £111,358 to £199,069) where wages have increased just 1%, meaning the gap between house prices and wages has risen 77% between 2001 and 2011.

3. Newcastle-under-Lyme in Staffordshire: House prices up by 114% (from £67,927 to £145,253) where wages have increased by 31%, meaning the gap between house prices and wages has risen 63% between 2001 and 2011.

4. Wyre Forest in Worcestershire: House prices up by 72% (from £99,980 to £172,085) where wages have increased by only 5%, meaning the gap between house prices and wages has risen 63% between 2001 and 2011.

5. Sandwell: House prices up by 92% (from £61,787 to £118,783) where wages have only increased by 19%, meaning the gap between house prices and wages has risen 61% between 2001 and 2011.

6. East Staffordshire: House prices up by 90% (from £82,164 to £156,219) where wages have increased by 21%, meaning the gap between house prices and wages has risen 57% between 2001 and 2011.

7. Telford and Wrekin: House prices up by 93% (from £79,035 to £152,874) where wages have increased by 25%, meaning the gap between house prices and wages has risen 54% between 2001 and 2011.

8. Stoke-on-Trent: House prices up by 109% (from £46,685 to £97,409) where wages have increased by 36%, meaning the gap between house prices and wages has risen 53% between 2001 and 2011.

9. Dudley: House prices up by 83% (from £79,422 to £145,130) where wages have increased by 21%, meaning the gap between house prices and wages has risen 50% between 2001 and 2011.

10. Malvern Hills in Worcestershire: House prices up by 72% (from £141,075 to £242,416) where wages have increased by 15%, meaning the gap between house prices and wages has risen 50% between 2001 and 2011.

During the same period, getting a mortgage also got a lot harder, with the amount of deposit needed in the West Midlands rising by 352%. In 2001 the deposit for a typical 90% mortgage (available in 2001) was £9,502. By 2011 the amount banks were willing to lend was less, and so the deposit needed for a typical 75% mortgage leapt to £42,927.

The five areas that have seen the greatest rise in the amount of deposit needed for a mortgage between 2001 and 2011 are:

• Newcastle-under-Lyme in Staffordshire - up 435% to £36,313.

• Stoke-on-Trent - up 422% to £24,352.

• Staffordshire Moorlands - up 384% to £39,076.

• Telford and Wrekin - up 384% to £38,219.

• Sandwell - up 381% to £29,696.

Gemma Duggan, West Midlands lead manager for the National Housing Federation, said: ‘These shocking figures show that it is getting increasingly hard for thousands of people in the West Midlands to buy a home of their own in the current climate.

‘Staffordshire Moorlands makes it into the top ten nationally for parts of the country that have seen the gap between income and house prices growing the most. It’s no wonder that people can often feel like they have to win the lottery to be able to buy in their local area.

‘A shortage of homes means the price to buy them is being pushed ever higher by the market, and out of reach of thousands of hard working families. Unless we start building more homes people can truly afford, to match the demand, this will only get worse.’

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