Property price rises are bad news

The unattributed article, “Property prices rise in Swindon”, informed us that the average property price in April was £233,294. The average increased by £18,000 in the last year. For some reason the author seemed to think this was good news. They described a 17.9% increase in the Forest of Dean as “the best annual growth”.On the contrary this continued rise in house prices is very bad news for anybody who is looking to buy a property. In Swindon, even the lower quartile (cheapest) houses/flats, have a price 7.47 times lower quartile wages, even worse than the 7.18 time median wages for median house prices.

This long term trend of prices outstripping wage increases simply means that only higher earners, or people moving from other even more expensive towns such as Reading and Oxford, can afford these prices.

Given the shortage of council housing those who cannot afford to buy are forced into the private rented sector where high demand has enabled private landlords to continue pushing up rents. The latest statistics for March 2021 show median rent for a one bed property in Swindon at £635 a month, the lower quartile (cheapest) at £595. The same figures for two bedrooms are £740 median and £695 lower quartile. A three bedroom median rent is £895 and £825 lower quartile.

With prices for sale and rent continuing to outpace earnings it’s clear that the housing crisis in the town cannot simply be resolved by more homes for sale which many local people cannot possibly afford. There remains a desperate need for a return to large scale council house building to provide genuinely affordable homes for rent.

Such a council building programme would also have the benefit of taking people out of the housing market, making it less of a sellers’ market and bringing prices down. So long as house building is dominated by speculative commodity production then the housing crisis will be protracted. The main obstacles to a council building programme remain right to buy and the refusal of the government to provide grant sufficient to turn councils into large scale builders once again. Even the Tory majority Local Government Association recognises this. It has called for the government to fund the building of 100,000 social rent homes a year.

Martin Wicks

This was a letter published on June 23rd 2021 in the Swindon Advertiser

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