Incomes are having an increasingly difficult time keeping up with the inflation of house prices across the UK, according to a recent study. Whilst house prices have been in skyrocket mode for some time, incomes are not and that is causing great debate among those in the housing market today. Many believe building more housing will not fix the massive issue of helping people realise the dream of owning a home, but higher incomes will.

Over the last 90 years house average house prices have increased at a rate which is twice as fast as earnings, according to a recent study by the New Economics Foundation. The two entities were closely related until the 1980’s. At that time house prices continued the pace whilst earnings tailed off. Now, there is great disparity between increase in house prices and our ability to pay for them.

It is estimated that by the time 2020 is here first time buyers will require at least a salary of £64,000 to be able to afford a down payment and then monthly payments on a house in the UK. This is a sobering figure and is making many first timers quite discouraged about the future. Government schemes make a difference, but are mainly focused on helping those seeking assistance on pulling together a down payment.

Alice Martin with the NEF commented on the latest survey, saying: “Let’s bring living costs back in line with what most people actually earn.”

Martin added: “It’s not unreasonable that we should all be able to put down roots in the areas we live, without the risk of eviction or a lifetime of mortgage debts. But with house prices rising way beyond incomes, finding a place to call home is becoming more and more difficult."

The data emphasises how fortunate house owners are and highlights how important it is to take advantage of tools like a remortgage.