Average house prices to ‘reach £300,000’

The average house price in England will breach the £300,000 mark in the next five years, according to research by the National Housing Federation.

The figures released by the NHF showed that house prices were around 10 times average earnings. Prices could rise by 40% as supply continues to fall behind demand.

Despite predictions from many analysts, the NHF said a fall in average house prices was highly unlikely. They suggested the only way to avoid a housing crisis was for the government to ensure three million new homes are built by 2020.

The NHF report also said that social housing is becoming increasingly popular among those priced out of the housing market. This has led to a 57% increase in waiting lists over the past five years.

Around four million people are currently on social housing waiting lists.

The NHF research showed average house prices have gone up by 156% since 1997, compared to a 35% increase in wages.

If this pattern continues, average house prices throughout England will exceed £300,000. In London, they will be closer to £500,000.

NHF chief executive David Orr said: "Our report shows that continuing house price rises and the resulting housing crisis are set to stay with us for a long time.

"A growing number of parents will find themselves subsidising their sons’ and daughters’ mortgages. Across the country, more and more people are going to find themselves priced out of the property market."

The NHF report supports the government plans to build 375,000 homes a year, including 70,000 new social homes.

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