‘Bank of mum and dad’ paying out thousands of pounds in Dearne

John Healey, MP
John Healey, MP

The cost of housing is causing huge financial strain for people in the Dearne Valley, according to new figures.

Research released last week by housing charity Shelter revealed the ‘bank of mum and dad’ is now paying out on average £23,000 to help their children get on to the property ladder, with many parents eating into savings set aside for retirement or elderly care.

Meanwhile, housing affordability figures released by the Trades Union Council showed Rotherham is one of 26 areas in the UK to have moved from ‘easily affordable’ to ‘out of reach’ in recent years because of rising house prices and low wage growth.

In 1997 the average house price was less than three times – 2.78 – the average annual salary but in 2013 owning a home had been pushed out of reach for many with prices at five times earnings, the figures showed.

The Bank of England recently instructed banks to limit the proportion of mortgages they offer that are more than 4.5 times applicants’ salaries.

Labour’s former housing minister and Dearne MP John Healey said: “The cost of renting and buying a home is causing huge financial strain in our area.

“The TUC figures bear witness to what many people are telling me, that while their wages don’t go as far, the cost of buying a home just keeps going up.

“House-building under this government is at the lowest level since the 1920s, pushing up prices and making it harder for people to buy.”

According to the government, more than 48, 000 people have bought a home through the Help-To-Buy scheme, which helps people buy a home with as little as a five per cent deposit.

Chancellor George Osborne said recently: “Help to Buy is working exactly as we intended. It’s helping first time buyers onto the housing ladder.

“It’s a key part of our long term economic plan, which is supporting hard working people,” he added.