£44k to buy first house

STOCK: Sheffield housing.
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A homelessness charity is warning that people in Nottingamshire will need to earn an average of £44,000 in order to buy their first home by 2020.

The research by housing and homelessness charity Shelter shows the figure is more than 20 per cent higher than the £37,000 needed for a typical first time buyer’s mortgage today.

On top of this they would need a typical deposit of £27,000 to keep up with rocketing house prices in the region, which are projected to rise to £175,000 over the next four years.

The research looked at the salary and deposit needed for the average first time buyer today, and calculated what they would be in 2020 if they grew in line with projected increases in house prices.

These figures come as no surprise given that, over the last five years, the region’s severe housing shortage has seen house prices rise five times faster than wages.

As the Government’s Housing Bill passes through the House of Lords, Shelter is warning that, unless the Government commits to building homes that people on ordinary incomes can actually afford, the situation is only likely to get worse.

Campbell Robb, chief executive, said: “When house prices are increasing five times faster than the average wage, it’s no wonder people on ordinary incomes are being locked out of a home of their own.

“With the situation only set to get worse, generation rent will be forced to resign themselves to a life in expensive, unstable private renting, and wave goodbye to their dreams of a home to put down roots in.

“It doesn’t have to be like this. The Government has the power to turn our housing crisis around, but only if they stop with schemes like starter homes which only help higher earners, and start investing in homes that people on ordinary incomes can actually afford to live in.”

Mike, a nurse, is currently renting and has had to move because of high housing costs.

“On a nurse’s salary and with house prices so high, I can’t see how I’ll ever own my own home,” he said. “At the moment, it feels like nothing more than a pipe dream.

“I’m stuck renting and looking at moving away from where I currently live because rents have gone up so much as well. It just seems so unfair.”