UK house hunters are finding it harder than ever to afford not only houses, but any rental property for that matter as well. Recent data regarding the UK housing market offers harsh reality of what many are facing when searching for housing. The reality is this. House prices are increasing each year at a pace which outstrips the growth of pay increases. Policy makers are now in the crosshairs of many calling for drastic reform to prevent the gap from widening further.

The average cost of a UK home is now £197,000. This price is 4.5% higher than at the same time last year. The average pay increase this year was only 2%.

According to Nationwide, house prices increased during the month of December 0.8% over the prior month.

Pete Jefferys with housing charity Shelter commented on the gap which exists between housing and those able to afford it, saying: “Our concern is that as house prices continue to rise faster than incomes, people are going to find it harder to get hold of a secure home that they can afford.”

The average cost of a home is a much different story within the city limits of London. Inflation there is booming as the cost of a home is more than 12% higher now compared with the same time last year. The average cost of a house in the capital city now sits at more than £450,000.

First timers are finding it especially difficult to attain a spot on the property ladder, regardless of where that may be. Now, there seems to be little relief in sight for anyone looking to purchase a property.

Nationwide’s Robert Gardner commented on the short term forecast for housing costs, saying:

“As we look ahead to 2016, the risks are skewed towards a modest acceleration in house price growth, at least at the national level, despite the likelihood of interest rate increases from the middle of next year.”