Rocketing house prices are creating a 'social crisis federation warns

First time buyers require an income in excess of £77,068 to buy an average priced home in Bromley, new research published today reveals.

Rocketing house prices in the borough, now averaging £283,937, are creating ‘nothing short of a social crisis’ the London Housing Federation warns, as an estimated 4,280 families are registered on waiting lists for affordable housing locally.

This number has risen by over 13% in the last five years.

Over one thousand households are living in temporary accommodation, unable to find and afford a permanent home.

The report Home Truths London: The real cost of housing 2007-2012 warns that high prices are leaving more and more people struggling to find a home of their own.

A market fuelled by massive City bonuses and foreign investment has pushed average house prices up by over 150% since 1997, whereas average wages have increased by just 35% over the same period.

“Broomleigh has a long history of providing affordable homes in the borough and is actively contributing to the number and range of affordable new homes locally through our current programme of 500 new homes;” said Nick Dudman, Interim Chief Executive of Broomleigh.

Olivia Powis, Regional Manager at the London Housing Federation, said:

“House prices in London have reached new highs, leaving thousands of first time buyers unable to get their foot on the ladder.

“Despite fears of a drop in the market, house prices remain beyond the reach of many Londoners and the capital faces nothing short of a social crisis; housing waiting lists have risen 57% in just five years, while others live in overcrowded or temporary accommodation.

“Poor housing has been found to cause health problems, lower educational attainment and family stress and breakdown, and we must tackle the housing crisis straight on to halt this spiral of housing need and the growing social divide.
 
She added: “For London to remain the great world city it is, we need more affordable homes, and we need them soon. Prime Minister Gordon Brown has pledged £8bn to build new affordable homes nationwide over the next three years. From this, housing associations in London need adequate funding to meet and exceed the Mayor’s target of delivering 50,000 affordable homes by 2011.”

The report also finds that:

• average homes in London now cost 13 times the average income. Mortgage lenders will rarely loan more than 4 times income;
• house prices rose by more than 10% in all but six London boroughs last year, and by 15% or more in one third of boroughs;
• in 2005/06 housing associations completed almost 700 homes for affordable rent or shared ownership in Islington;
• the Mayor of London has set a target of 30,500 new homes a year in the Draft Housing Strategy - 62% above the completion level for 2005/06;
• the latest official household projections suggest 39,400 new households a year will form in London during 2004 to 2026;
• meeting newly arising housing needs over the next 20 years would require more than doubling current levels of new housing completions in the capital.