The current housing situation in the UK is a gloomy one with no hope of rays of light piercing through.
House prices in UK increased by 10.9% in the year 2022 from 10.2% in January to February 2022. Rents of private houses in Britain rose steeply in the last 12 months to reach an average £1,088 per calendar month (pcm) for houses outside London. This data is culled from Rightmove.
This 10.8% increase from £982 pounds per calendar month is the largest annual jump recorded by the property website.
Manchester and Liverpool experienced the steepest increases and average rents kept growing by 19.3% and 17.1% respectively.
In the capital, rents attained a record average of £2,193 pounds per calendar month in the first quarter of 2022. This represents an increase of 14.3% compared with this time last year, when the average London rent was £1,919 pounds per calendar month.
The price of an average home is about a one fifth higher than it was in February 2020, before the coronavirus lockdowns started in the UK, according to Nationwide. This implies a cash increase of £44,140.
As prices of house growth has surpassed wage increases, housing affordability has become stretched. The price of an average home sits at about 6.7 times above average earnings, up from a ratio of 5.8 in 2019, according to Nationwide. This shortage in the availability of affordable housing is as a result of excess house demand and limited housing facilities.
Effects of the spiraling prices of houses
The general effect of the rapidly increasing prices of houses takes on toll on the society and economy at large. From a rise in the overall cost of living to a steady increase in criminal activity, the general outlook is not good. However, what is the effect on the people who are actively searching for affordable and suitable accommodation?
Exploitation of home seekers
Some house seekers will end up being exploited as a result of their desperation to acquire accommodation. They may fall victims to unscrupulous agents promising lower prices. Also, they may end up acquiring very substandard accomodations for very high prices due to limited funds available for expenses.
Low standard of living
Home seekers may end up living below the standard of living after acquiring their accommodations at high prices. This is caused by the fact that wages are not increasing alongside increasing house prices.
The terrible states of affairs could lead a lot of accommodation seekers into depression as well.
Experts are hopeful that in the years to come, this trend will be reversed. We can only keep our fingers crossed and hope that this happens very fast.