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Can you really afford to buy a house in Norfolk?

PUBLISHED: 17:34 14 May 2018 | UPDATED: 08:27 15 May 2018

You need to pay almost 10 times your annual income to  afford a house in North Norfolk. Pic: www.gettyimages.co.uk

You need to pay almost 10 times your annual income to afford a house in North Norfolk. Pic: www.gettyimages.co.uk

How affordable are houses where you live? New data published yesterday shows in Norfolk, you need to pay on average eight times your annual income to buy a roof over your head as price rises soar way above wage increases.

Burnham Overy Staithe, north Norfolk, where house prices have outstripped wages. Pic: www.gettyimages.co.ukBurnham Overy Staithe, north Norfolk, where house prices have outstripped wages. Pic: www.gettyimages.co.uk

People have to spend, on average, eight times their annual salary to be able to afford to buy a house in Norfolk.

This comes as new data today shows house prices have risen by as much as 131 per cent over the past 15 years in some areas of the region with salaries going up by as little as 34 per cent in other areas.

The least affordable area is North Norfolk where people have to spend nearly 10 times their annual income to be able to afford a house.

This contrasts with the Great Yarmouth area where the lowest ‘affordability ratio’ of house price to earnings exists, but you still have to spend nearly seven times the annual local income to buy a house.

In fact, the Yarmouth area has seen one of the biggest house price increases of 127 per cent since 2002 compared with just a salary rise of 37 per cent.

The ONS, Office for National Statistics, report showed house prices were less affordable in all areas of Norfolk and Waveney compared with a year previously.

Nick Taylor, of Norwich estate agent Hadley Taylor, and the chairman of the NDAEA, the Norwich & District Association of Estate Agents, said: “There is no doubt that house prices have risen to such a degree in recent years that some buyers are struggling to get on the property ladder or to move on to a bigger property.

“Wages haven’t been rising nearly fast enough to allow most people to keep up in recent years, however, wage inflation is now running at a higher rate of increase than both inflation and property price growth so we are entering a period when the balance can be restored to the market over the next couple of years. Simply building more houses isn’t really the solution. We have to do something about demand which means talking about the ‘elephant’ in the room – not the housing crisis but the population crisis.”

Ben Marchbank, of Bedfords in Burnham Market, said: “If one considers the fluctuations in the property market over the last 60 years, there is a clear correlation between interest rates and house price inflation.

“The fact that wages are not keeping pace with house prices makes it increasingly difficult for each successive generation of buyers. An increase in the volume of houses being built should help but the fundamental issue is that cheap borrowing fuels house price inflation.”

So how does your area fare?

Norfolk

Breckland:

Affordability ratio is 8.65 ie: prospective buyers have to spend almost nine times their annual salary to buy a home.

In 2002, the average home in Breckland then cost £92,500. The 2017 figure is 125% higher.

In that time the average annual salary has only increased by £6,110, a 34% rise.

Broadland:

Affordability ratio was 8.65.

In 2002, the average home in Broadland then cost £112,560. The 2017 figure is 111% higher.

In that time the average annual salary has only increased by £8,203, a 43% rise.

Great Yarmouth:

Affordability ratio was 6.69.

In 2002, the average home in Great Yarmouth then cost £72,000. The 2017 figure is 127% higher.

In that time the average annual salary has only increased by £6,595, a 37% rise.

King’s Lynn and West Norfolk:

Affordability ratio was 7.89.

In 2002, the average home in King’s Lynn and West Norfolk then cost £90,000. The 2017 figure is 122% higher.

In that time the average annual salary has only increased by £6,899, a 37% rise.

North Norfolk:

Affordability ratio was 9.62.

In 2002,the average home in North Norfolk then cost £105,000. The 2017 figure is 124% higher.

In that time the average annual salary has only increased by £6,978, a 40% rise.

Norwich:

Affordability ratio was 7.2.

In 2002, the average home in Norwich then cost £86,973. The 2017 figure is 114% higher.

In that time the average annual salary has only increased by £7,426, a 40% rise.

South Norfolk:

Affordability ratio was 8.87.

In 2002, the average home in South Norfolk then cost £114,500. The 2017 figure is 111% higher.

In that time the average annual salary has only increased by £7,692, a 39% rise.

Suffolk

Waveney:

Affordability ratio was 7.58.

In 2002, the average home in Waveney then cost £78,500. The 2017 figure is 131% higher.

In that time the average annual salary has only increased by £6,911, a 41% rise.

Suffolk Coastal:

Affordability ratio was 8.83.

In 2002, the average home in Suffolk Coastal then cost £125,000. The 2017 is 120% higher.

In that time the average annual salary has only increased by £9,322, a 43% rise.

Nationally, as a result of the inability of so many to get on the property ladder, the proportion of households renting has doubled over the last decade.

Polly Neate, chief executive of housing charity Shelter, said: “With millions struggling to find a stable home, it’s time the government offered people a long-term alternative to homeownership by building homes that are genuinely affordable to rent, including many more social homes.”

Each year the ONS calculates how affordable housing is in England and Wales, by dividing the median house price in local authorities by the median full time annual income.

The ONS uses the median instead of the mean as the average, which is the exact middle number in a series, so not distorted by the extreme highs and lows.

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Caroline Culot

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I am the property editor in charge of delivering some exciting and informative content within Archant’s varied titles. We have 16-17 pages of stories, features and columns in the EDP Property supplement out every Friday free in your EDP so please don’t miss it.