Important:

This article is for information purposes only.

Please remember that financial investments may rise or fall and past performance does not guarantee future performance in respect of income or capital growth; you may not get back the amount you invested.

There is no obligation to purchase anything but, if you decide to do so, you are strongly advised to consult a professional adviser before making any investment decisions.

Homes less affordable in Bolton as prices outstrip earnings

house price

In 2020, the average house price in Bolton was £145,000, while the average annual salary was £27,107

Homes became slightly less affordable in Bolton last year as house prices outstripped average earnings, figures reveal.

Charities and housing professionals say a lack of new affordable homes has fuelled a national decline in affordability over the last two decades.

Each year, the Office for National Statistics (ONS) calculates housing affordability by comparing the median house price in a local authority area to the median full-time annual income of people who live there.

The higher the ratio is, the less affordable homes are to buy.

In Bolton, the average house price was £145,000 and the average annual salary was £27,107 in 2020.

That meant prospective buyers would need 5.4 times their annual salary to buy a home.

That figure was up slightly from 5.2 a year earlier, as the cost of a property grew by 5.8 per cent, while the median wage increased by 2.1 per cent, making homes a fraction less affordable on average.

Affordability ratios varied across the north west last year – in Trafford, house hunters spent 8.4 times their annual earnings on a property on average, while in Copeland, the ratio was just 3.0.

The ONS said affordability across England and Wales had not changed significantly from the year before, but added that it has worsened overall since 1997.

Back then, the gap between ratios in the most and least affordable areas was just 9.9. By 2020, that had risen more than triple to 33.8.

Polly Neate, chief executive of housing charity Shelter, said homeownership is out of reach for many people, especially those on lower and insecure incomes.

We haven’t built enough good quality or affordable homes for decades, meaning house prices have sky-rocketed, she said. With no way of buying and a chronic shortage of social homes, millions have become trapped in expensive private rentals.

Ms Neate said more “genuinely affordable” homes are needed nationally. She added: Unlike the Government’s other unaffordable homeownership schemes, like Help to Buy, social homes are actually pegged to local incomes meaning they are affordable by design. The Government must urgently invest in building social housing.

House prices have soared in Bolton since 2002 – the earliest point at which local data is available.

The median cost of a property then was £55,000, with last year’s figure more than double that. Over the same period, the median annual salary increased by £8,497, a 46 per cent rise.

A report by the Chartered Institute of Housing says that across the UK as a whole, house prices are more affordable than at their most recent peak in 2007, but less so than compared to 1994.

John Perry, CIH policy advisor, said: While a range of factors contribute to this, such as changes in incomes, the gap between housing supply and numbers actually needed is fundamental.

He said: In England, the government target of 300,000 new homes annually has never been met in recent years and within this, it has never delivered sufficient homes at affordable rents. This means there is still a crisis of affordability, whether assessed in relation to house prices or wider affordability in terms of rents in the private and social sectors.

Important:

This article is for information purposes only.

Please remember that financial investments may rise or fall and past performance does not guarantee future performance in respect of income or capital growth; you may not get back the amount you invested.

There is no obligation to purchase anything but, if you decide to do so, you are strongly advised to consult a professional adviser before making any investment decisions.