Housing minister says rising house prices 'a good thing' despite millions unable to buy
04-03-2014
THE housing minister has come under fire for saying it is "a good thing" house prices are rising – despite millions being priced out of home ownership.
By: Benjamin Russell
Kris HopkinsThe housing minister said the government are not making the housing crisis worse [GETTY]
Kris Hopkins made the controversial comments just hours before figures released this morning show homes are now up to 18 per cent more expensive than they were last year.
Mr Hopkins said that homeowner, including himself, now expected the value of their house to continue to rise.
Speaking on BBC's Newsnight last night, he told Jermey Paxman: “I bought a house and I expect the value to rise, and I'm sure you did as well."
Mr Hopkins said rises were "certainly part of the market", but stressed that prices were still well below the pre-credit crunch highs.
"We are nowhere near the peak at this moment in time," he added.
But the remarks have sparked an angry backlash, with people accusing the minister of ignoring the millions of people being priced out of the housing market.
Campbell Robb, Shelter’s chief executive, was among those who condemned the comments.
He said: “Another rise in house prices is another rise in people left priced out.
"Unless house prices are stabilised, the grim reality is that our rollercoaster property market will leave thousands watch their dream of ever owning a home slip further out of reach.
“No matter how hard young people and families work or save, these days most simply can’t afford a home of their own and are instead facing a lifetime of unstable renting.
“If we want to give the next generation a fighting chance, the government has to get serious about building the affordable homes we need now.”
The row happened as fresh figures this morning showed the biggest jump in property prices for four years – fuelled by a surge in London and the south east.
Homes in the capital have leapt by 18.2 per cent annually, taking the typical house price to £362,699 – higher than its 2007 peak.
Across the UK, prices rose by 9.5 per cent year-on-year, which is the biggest jump in almost four years and takes the typical property value to £180,264, amid signs that the upturn in the market is gaining momentum across the country, the report for March said.
In the south east areas were up by 10.1 per cent year-on-year, reaching an average of £217,534.
Prices in Wales have risen by 5.2 per cent annually to £139,911 typically, with Wales recording the weakest annual growth across the UK regions.
Property values in Scotland are 7.6 per cent higher than a year ago, at £138,386 on average, which is the strongest pace of growth seen for the nation since 2007.
Prices in the South West have jumped by 7.4 per cent year-on-year to reach £198,325 typically. In the North, values edged up by 5.9 per cent annually, taking the average price to £119,702, making it the weakest English region for house price growth. In East Anglia, values rose by 9.5 per cent year-on-year to around £179,718.
Among England's major towns and cities, Manchester was found to be the strongest performer, with house prices up by 18 per cent annually to £211,748 on average. Sunderland was the weakest-performing, with prices edging up by 1 per cent to £139,772 typically.
The boom in prices has been blamed on a lack of supply while in London there is huge investment from overseas buyers.
Government schemes, including Help to Buy, are also said to have helped fuel a fresh stream of first time buyers.
On Newsnight, Mr Hopkins admitted the country was "woefully short" in terms of housing supply but denied the Conservatives were adding to the problem.
He said: "I don't agree with the fact that we are stoking demand, I certainly agree that we need more housing."
Nationwide have said the upturn in the supply side of the housing market generally "continues to lag far behind", with the number of new homes being built in England still around 40 per cent below pre-financial crisis levels.