The unaffordable cost of housing

The average price of a home in Gloucestershire is nearly £280,000 – 10 times average earnings. In the Forest of Dean it’s £225,000 – more than eight times average income.

With wages below national average, high levels of unemployment, a shortage of affordable properties, and increasing food and energy prices, many people struggle to buy their own home.

Those who choose to rent instead are faced with paying nearly £800 a month to rent privately (£600 in the Forest) – more than one-third (nearly a quarter in the Forest) of their average income – or joining the long waiting list for a lower-cost housing association or local authority home to become available.

The National Housing Federation has just published its annual ‘Home Truths’ report  for 2017/18, which looks at housing demand, supply and affordability across the country. Its spotlight on the South-West reveals the following about Gloucestershire and the Forest of Dean (using 2016/17 data):

In Gloucestershire:

  • The average wage is £27,659.
  • The average house price in the county is £278,492 – although a home in the Cotswolds could set you back £397,000, almost 50% higher than the regional average.
  • Anyone looking to buy their home will need a gross annual income of £63,655 to be able to secure an 80% mortgage.
  • The county has 3,700 second homes, and nearly 2,500 properties are identified as ‘long term empty’ and not being used at all.
  • There are just 30,000 ‘affordable’ homes available to rent through a housing association or local authority, yet there are long waiting lists and almost 14,000 people are queuing up to rent them when they become empty.
  • Almost a quarter (23%) of people claiming Housing Benefit are in work, but rely on state funding to help them make ends meet

In the Forest of Dean:

  • The average wage is £26,863.
  • The average house price is £225,636.
  • Anyone looking to buy their home will need a gross annual income of £51,574 to be able to secure an 80% mortgage.
  • The district has 267 second homes and 465 properties are identified as ‘long term empty’ and not being used at all.
  • There are just 5,200 ‘affordable’ homes available to rent through a housing association or local authority, yet there are long waiting lists and over 1,900 people are queuing up to rent them when they become empty.
  • One-fifth (20%) of people claiming Housing Benefit are in work, but rely on state funding to help them make ends meet.

Two Rivers Housing, and its neighbouring housing associations, are working hard to address the present local shortage of affordable homes, and planning their building programmes to meet predictions of future demand. Two Rivers has committed to build at least 100 new homes each year.

Schemes currently in development, or starting on site within the next six months, include homes in Gloucester (29), Newent (79), Tutshill (54), Tetbury (19), Staunton (11) and Tewkesbury (162), across a range of tenures including affordable rent and Shared Ownership. Planning permission is awaited on a scheme of 21 homes at Alfrick in Worcestershire and seven at Stagholt in Stroud which, collectively, includes 20 for private sale.

This annual Home Truths report shows a worsening picture every year,” said Garry King, Chief Executive of Two Rivers Housing. “There is a yawning gap between people’s earnings and borrowing capacity and the cost of getting a mortgage or renting a home privately.

“There’s also a chronic shortage of homes of all types in this area and the pressure is on to build enough new properties to give people the chance of finding somewhere to live which suits their budget, work opportunities, family and social connections, or simply their personal choice.

“More land needs to be freed up for building to address the shortfall, and the land that is available needs to be built on as soon as possible. Any barriers to development need to be addressed urgently. Meanwhile, we are committed to building at least 1,000 quality homes over the next 10 years – around 100 new homes a year that will meet the needs of people of all ages, and we will do more if we can.”

  • You can view the Home Truths 2017/18 report on the housing market in the South West at www.housing.org.uk/hometruths .