Owning a home has become virtually impossible for many public sector workers across Britain, according to research published today (Sunday) by UNISON.
Getting a deposit together and obtaining a mortgage are often insurmountable hurdles for those living in the majority of local authority areas across England, Scotland and Wales, according to the findings.
The UNISON report Priced Out highlights how saving the money for a down payment on a property would take decades – or more than a century for public sector staff in some parts of London. This is based on first-time buyers being able to save £100 every month for a deposit*.
The research focused on the salaries for employees in five jobs – an NHS cleaner, teaching assistant, librarian, nurse and police community support officer (PCSO) **. It calculated what multiple of their annual income they would need to borrow for a mortgage once they had paid a deposit.
Across all nine English regions, Wales, and Scotland, it would take a minimum of 14 years to save the required deposit for a first-time buyer property, and considerably longer if house prices continue to rise, says the report.
However, in London it would take between 132 years (in Kensington and Chelsea) and 35 years (in Barking and Dagenham) to find the money, and 32 years to save the necessary deposit in the South East.
Priced Out shows that an NHS cleaner in London earning £21,786 a year would need to borrow on average 16.5 times their salary to secure a mortgage for a first-time buyer property.
A teaching assistant earning £19,446 a year in the South East would need to apply to borrow more than 11 times their annual wage, and in the East of England a PCSO on £23,346 would need nearly 9 times their pay.
Given that the Bank of England’s maximum recommended lending limit is 4.5 times a person’s salary, Priced Out shows that a mortgage is completely unattainable for an NHS cleaner or a teaching assistant in every part of Britain.
For a PCSO, the North East is the only region where a mortgage and owning their own home is a possibility. A librarian or a nurse could only do this in the North East or Scotland.
The report shows that the housing outlook is bleak, with house prices predicted to grow faster than wages until at least 2022.
Priced Out follows on from the UNISON report Nothing Going on But the Rent, published in June, which highlighted the high cost of renting for public sector workers in England. The report found that average rents were unaffordable in many regions, especially for people working in lower paid jobs such as hospital porters and teaching assistants.
Commenting on the Priced Out report UNISON general secretary Dave Prentis said: “Owning a home is now little more than a pipe dream for most public sector workers.
“Deposits and mortgages are quite simply way out of reach, while the spiralling cost of renting is eating up a growing proportion of the take home pay of working people across Britain. Wage rises haven’t kept pace with soaring house prices and rents, and the situation looks set to worsen.
“The struggle for housing cuts across generations, jobs and regions. Employees are being forced to work further away from their jobs, and young people cannot afford to move out of the family home.
“The government has had more wake-up calls over the growing housing crisis than hot dinners. Decisive, creative and responsible action is needed now.”
Notes to editors:
– * UNISON has based its calculations on a property deposit of 15%.
– ** The data is based on the starting salaries of a band 2 NHS cleaner and a band 5 nurse, and the most common pay rate for a teaching assistant and a librarian. For the PCSO it is the typical starting rate plus shift allowances.
– London salary figures are based on the NHS high cost area supplement for inner London, the inner London weighting and fringe area allowance for local government jobs, and the PCSO (including shift and location allowances) pay rates as published on the Metropolitan Police website.
– Scotland pay rates are different for a nurse and a librarian. In Scotland the nearest job to a teaching assistant is a classroom assistant, again on a different salary. There is no equivalent job to a PCSO in Scotland, so the study uses the salary for a police custody and security officer.
– The UNISON report Priced Out is available here and contains a full regional breakdown of the 377 local authority areas covered by the research.
– Case studies are available via the UNISON press office.
– UNISON general secretary Dave Prentis will be taking part in a photo opportunity with public service workers at the 150th annual TUC in Manchester on Sunday 9 September at around 1.30pm. Further information is available from the press office.
– The UNISON report Nothing Going on But the Rent, published in June, is available here.