Sussex's buoyant economy will be "strangled" unless first-time buyers can afford to get on the property ladder, a business support group has warned.

Skilled workers will leave the county in droves if house prices continue to rise, according to Sussex Enterprise.

Sky-high property prices already force people to commute into Sussex, the group said, putting huge pressure on the transport system.

Interest rate hikes have taken the air out of the property market, according to some city experts. But prices could still go up by 15 per cent this year - far more than most forecasters predicted at the beginning of the year.

Sussex Enterprise was reacting to figures from the Halifax Annual First Time Buyer Report, which showed 23 out of 25 towns in Sussex were "out of range" for first-time buyers.

An average house in Sussex now costs a staggering £194,833, more than £30,000 higher than the national average of £162,852.

Steven Gauge, director of membership and communication at Sussex Enterprise, said: "There is a skills gap all across Sussex that cannot be bridged while it is too expensive for a lot of people to move here."

Tuesday July 06, 2004