70% of homes on the market in the North West unaffordable for first time buyers, new research shows

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70% of properties for sale in the North West are unaffordable for the average working family looking to buy their first home, new research from Shelter shows.

The charity looked at asking prices for thousands of properties for sale in the North West on a given day and compared them with the mortgage that families, couples and single people on average wages could afford as first time buyers.

The research revealed that in over a third of areas in the region, fewer than one in four of the suitable homes on the market were affordable for a typical family, even assuming that they were able to save an 18% deposit – the average size deposit for a first-time buyer.

The situation is even worse for those hoping to buy with a smaller deposit. Shockingly, the charity’s research found 79% of homes for sale in the North West are unaffordable for families with a 95% loan, as higher monthly mortgage costs push even more homes out of reach. This means that the government’s Help to Buy mortgage guarantee scheme is unlikely to improve the outlook for first-time buyers, says the charity.

The results paint an alarming picture of the North West’s affordability black spots, where the chances of finding a suitable property were near zero. These included Blackpool where 282 out of 1,253 homes for sale were affordable, Trafford where there were 187 out of 1,356 homes for sale, and South Lakeland where there were just 43 out of 1,069.

Shelter is calling on the government to put the prospect of a stable home back in reach of ordinary working people by committing to plans to build more homes. These include investment in a new generation of part rent, part buy homes, and making sure that smaller house builders can find the finance and land they need to build.

Nationally more than 80% of properties for sale are unaffordable for the average working family looking to buy their first home, showing that England’s chronic shortage of affordable homes is widespread.

Single people in the North West have the least chance of getting a foot on the property ladder, with only 13 out of every 100 homes on the market affordable for someone on an average wage.

But the research found that even couples without children who have two full-time incomes could still find it a struggle. Almost half of the homes for sale in the North West are unaffordable for a couple without children on average wages.

Recent figures from the government show that average house prices in the UK have risen by 9.9% in a year to £260,000 - higher than their pre-crisis peak in 2008. With soaring housing prices and the lack of affordable homes beginning to take effect, official figures published earlier this year showed that homeownership in England has fallen to its lowest level since 1987.

Case study: Fiona and her husband both work full-time. They currently live in a three bedroom rented home with their three children, but are fed up with the instability and high-cost of private renting. However, even if they could save up the deposit, they’ve come to realise that the mortgage they could afford means there is little hope of buying anywhere suitable in the area where they work and their children go to school.

Fiona said: “It feels like the only way to provide our children with a stable home is to buy, but rents are so high that we have little or no money left to save for a deposit. And even if we could save for a deposit we could never afford the mortgage for the family-sized home we need. So we're working hard, but stuck paying an enormous percentage of our income in rent and watching any chance of securing our own home completely disappear. We're not alone, something needs to change.”

Campbell Robb, chief executive of Shelter, said: “When a family looking to buy their first home searches a whole town for a place to live and finds nothing they can afford, it's clear we’re not just facing a housing shortage any more: it’s a full-blown drought.

“As the pool of affordable properties shrinks ever smaller, thousands of people are being forced to wave goodbye to their dreams of a home of their own – even those who’ve been able to put aside a large deposit. It’s a bitter pill to swallow when we know that politicians can turn the tide on our housing shortage in a single parliament.

“Our failure to build more homes is leaving a whole generation of young people with no choice but to remain trapped in expensive and unstable private renting, or stuck in their childhood bedrooms for years to come, no matter how hard they work or save. The only way to bring house prices back within reach is to fill the gap between the homes we have and the homes we need.

“Help to Buy or tweaks to planning rules will only ever be sticking plaster solutions. Bringing a stable home back within reach will take bolder action like helping small local builders to find the finance they need to get building, and investing in a new generation of part rent, part buy homes. What we need right now is for politicians to roll up their sleeves and make stable homes for the next generation a top priority.”