Continued interest rate rises could lead to a surge in house repossessions in the South West. The Royal Institution of Chartered Surveyors (RICS) warns of more home repossessions unless action is taken over South West's "affordability gap".
In January the Bank of England's Monetary Policy Committee decided to raise rates to 5.25% and although rates stayed on hold last week, further increases are forecast for 2007.
And with the South West already facing the UK's biggest affordability gap - the difference between average incomes and average house prices - RICS is warning that more people who have made it onto the housing ladder face the prospect of losing their homes.
RICS' "accessibility index" has found that nationally, constantly rising house prices has meant that accessibility is around 230 times worse than it was ten years ago, and currently as low as 1980.
The average first-time buyer couple will now have to save up to the equivalent of 82% of joint income to build up the amount of savings needed to pay for their home, deposit and stamp duty, compared to 25% in 1996. And with house prices expected to rise another 12% over the next two years, the situation is set to worsen.
