Affordability measures decline 230% says Rics

Posted: 11 Jan 2007 10:27:32 GMT

The cost of climbing onto the housing ladder rose 13.8 per cent during 2006, a new accessibility index from the Royal Institution of Chartered Surveyors (Rics) has shown

The cost of climbing onto the housing ladder rose 13.8 per cent during 2006, a new accessibility index from the Royal Institution of Chartered Surveyors (Rics) has shown.

Affordability has declined 230 per cent over the last ten years said Rics, reaching lows not seen for more than 25 years.

Paying for a deposit and covering other associated costs of buying a first home now takes 81.8 per cent of the average first-time buyer's annual take-home pay.

This compares to just 25.2 per cent in 1996. Rics warned that costs will continue to increase, with house prices expected to rise a further 12 per cent by 2009.

"Spiralling house prices have created a property glass ceiling for many first time buyers," said senior Rics economist David Stubbs.

"The government's plans to create an inclusive society seem like a pipe dream.

"Unless the government builds more affordable housing, and raises the stamp duty threshold, many households will continue to struggle to access the housing market."

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