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Brighton and Hove workers need £47k pay rise to keep up with house inflation
12:10am Tuesday 11th February 2014 in News
Workers earning the average wage in Brighton and Hove would need a £47,000 pay rise to keep up with local house inflation, a new report estimates.
The city has the second biggest gap between the rate of growth in average earnings and house prices in the south east between 1997 and 2012, beaten only by Elmbridge in Surrey.
Experts warned of the "very serious social implications" of increasing numbers of adults still living in their childhood bedrooms following a first drop in home ownership in England since records began.
And campaigners called on the Government to urgently invest in new affordable housing stock, arguing that its Help to Buy scheme would only make matters worse for first-time buyers.
Campbell Robb, chief executive of housing and homelessness charity Shelter, said: "When you'd need to more than double your salary just to keep up with rising house prices, it is no surprise that the dream of a home of their own is slipping further out of reach for a generation.
"Politicians need to start meeting people halfway by committing to bold solutions that will get more affordable homes built. Otherwise future generations will find themselves priced out of a stable home, however hard they work or save.
"The reality is that successive governments have failed to build the affordable homes that this country needs, and as a result our housing shortage has reached crisis point.
"Despite the fanfare surrounding Help to Buy, pumping money into mortgage guarantee schemes is not the solution.
"This further inflates prices by increasing demand for an already limited number of homes, and will only make things worse for the next generation of first time buyers. The only solution is to build more affordable homes."
A study carried out by the charity comparing average earnings and house prices between 1997 and 2012 found that average earners would need a £29,000 pay rise to keep up with soaring house prices.
The Castle Trust, an equity loans and property investment provider, warned that its own research showed that over the past 30 years the average cost of a home for first time buyers had increased by 480%.
The results of a poll of people 2,034 conducted by ICM on its behalf discovered that 27% of adults surveyed had given up on ever getting on the property ladder, including 28% of people aged 25 to 44.
The poll also found that just one in seven adults (14%) not currently on the property ladder thought they would be able to buy a home before they are 30.
More than half of people struggling to get on the property ladder (53%) found that raising a deposit was the main problem, according to the poll.
Up to 38% said they did not earn enough to own a house and a further 21% believe they would not be able to keep up with mortgage payments.
And one fifth (20%) said that they would be unable to buy their own home because their credit rating was not good enough to qualify for a mortgage.
With such a bleak outlook, respondents said they were hoping to be able to borrow from parents (12%), grandparents (5%) or receive an inheritance (9%).
Sean Oldfield, chief executive officer at Castle Trust, said: "The failure of the young to break into the housing market has some very serious social implications.
"Older generations know this and want to help - many have the resources to do so."
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