House prices outstrip wage

File photo dated 22/01/08 of houses in south Derbyshire as  Surveyors' expectations that house prices are set to increase into the new year surged to their highest levels in more than 14 years in November. PRESS ASSOCIATION Photo. Issue date: Tuesday December 10, 2013. The Royal Institution of Chartered Surveyors (Rics) said that a balance of 59% more surveyors predict rises will increase rather than edge down over the next three months as the number of homes for would-be buyers to choose from continued to fall "well short" of demand. Meanwhile, the proportion of surveyors predicting sales will pick up heading into 2014 reached a record level, with a net balance of 76% more surveyors expecting sales to increase, marking the highest reading in records going back to 1998. See PA story ECONOMY House. Photo credit should read: Rui Vieira/PA Wire
File photo dated 22/01/08 of houses in south Derbyshire as Surveyors' expectations that house prices are set to increase into the new year surged to their highest levels in more than 14 years in November. PRESS ASSOCIATION Photo. Issue date: Tuesday December 10, 2013. The Royal Institution of Chartered Surveyors (Rics) said that a balance of 59% more surveyors predict rises will increase rather than edge down over the next three months as the number of homes for would-be buyers to choose from continued to fall "well short" of demand. Meanwhile, the proportion of surveyors predicting sales will pick up heading into 2014 reached a record level, with a net balance of 76% more surveyors expecting sales to increase, marking the highest reading in records going back to 1998. See PA story ECONOMY House. Photo credit should read: Rui Vieira/PA Wire

Over the last 16 years house prices in Broxtowe have outstripped average wages and become unaffordable, according to latest figures.

The Trade Union Congress (TUC) revealed that house prices in Broxtowe had risen from 3.05 times the average local salary in 1997 to 5.47 times the average local salary in 2013.

The TUC believes that the combination of soaring house prices, frozen pay packets and the longest real wage squeeze in over a century has left house prices more out of reach in the district than ever before.

In 1997 the average house price in the vast majority of the East Midlands was less than five times the average worker’s salary and only Rutland had a housing to wage ratio exceeding this.

However, now only ten districts have house prices that are less than five times the average local salary.

Recent analysis by the TUC also found that pay packets in the East Midlands fell by around £45 a week in real terms between 2010 and 2013 – a fall of 8.7 per cent.

The TUC explained that the affordability ratio of five is particularly significant because the Bank of England has recently instructed banks to limit the proportion of mortgages they offer that are more than 4.5 times applicants’ salaries.