FTBs face future house prices 10 times earnings, NHPAU warns

FTBs face future house prices 10 times earnings, NHPAU warns
Future first-time buyers (FTBs) may be faced with average House prices at ten times their annual income, the National Housing and Planning Advice Unit (NHPAU) has predicted.

According to the NHPAU's calculations, average House prices may soar to ten times average earnings by 2026, compared with seven times annual earnings this time last year.

Indeed a survey carried out by the NHPAU of 2,722 adults found that 35 per cent of people now believe they will never be able to own their own home, with 18 per cent claiming it will take them five years or more to buy their own place.

Speaking on BBC Radio 4's Today programme, NHPAU chairman Professor Stephen Nickell explained that property prices would keep rising: "The average person in the UK, and this specifically of course refers to England, is getting richer all the time and demanding more housing.

"On top of that the number of households is expected to grow at a faster rate over the next 20 years than it has been in the recent past - as many as 220,000 households a year."

Looking to the future he forecast a rise in the need for social housing: "There will be much more rental housing, and of course not only the price of houses to buy will go up, but of course rents will become very expensive and ultimately of course that will lead to a big increase in the numbers of people applying for social housing.

"In some senses this is why it matters to all of us, because it's going to be our taxes which are going to have to pay for the big increase in social housing."