Cheap housing is one of the South East's biggest problems, says a report today from the Countryside Agency.

The East and London Regional Review of the State of the Countryside 2001 is the first regional document to report on the agency's indicators.

The findings show the South East is a mainly prosperous area and much of its population enjoys a relatively high quality of life.

This image, however, masks pockets of deprivation.

Many areas are still deprived of basic services such as a doctor's surgery or a general store.

A spokesman said: "But perhaps the most widespread problem in the South East is that of housing affordability.

"With its proximity to London and the charm and beauty of the countryside, much of the South East's housing stock is becoming priced out of reach of the local rural population, unable to match the economic power of those people moving into the countryside.

"We will continue to draw the Government's attention to this and other regional issues.

"Last year's foot-and-mouth disease outbreaks did provide a focus on countryside issues, and one third of all businesses in the region claim to have been adversely affected.

"The outbreaks, though relatively minor in the South East, did hurry in much needed changes to rate relief for rural shops and services.

"They kick-started the provision of tailored business advice to rural small businesses and brought into focus the importance of buying produce locally.

"But this focus tended to push some of the other important issues out of the limelight - post offices, schools, healthcare services.

"We need to re-focus on these issues."