Research published today by the National Housing Federation (NHF) claims that the average house price in England will rise to over £300,000 within five years.
The NHF is expecting a lull in house price growth over the next two years followed by a spurt in growth in 2009, due to lower mortgage rates and the continuing housing shortage. The NHF says such a high rate of inflation will leave the average house price at £302,400 by 2012.
The NHF claims rising house prices are causing increased strain on the social housing system and says waiting lists have grown by 57% in the last five years to around 1.6m households.
The Government has already said it will build 70,000 social homes per year and the NHF has today called for this promise to be kept to ease the crisis.
The research also found that the average house price in England last year was £206,594, or about 11 times average earnings. House prices have grown 135% since Labour came to power in 1997 but incomes have risen by just 35% over the same period.
David Orr, chief executive of the NHF, warns: “House prices will break the £300,000 barrier by 2012. Homeowners might see this as good news, but most will only benefit if they can sell up and move to a smaller property. In fact, soaring house prices are having a disastrous impact on the country.”
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