Rural areas hit by drop in number of first-time buyers

The number of people getting their foot on the property ladder is lowest in the Hambleton district, where house prices have soared.

Elsewhere, the Wear Valley is the third most affordable rural area in the country, according to the English Rural Housing Index, published by Halifax.

The index covers 118 local authorities across England and uses Halifax house price data from 1994 and 2004 to calculate movements on the housing market in rural areas.

Nationally, the proportion of first-time buyers has declined from 27 per cent in 1994 to 16 per cent last year.

In Hambleton, where the average house price in 2004 was £218,889, the figure is just 12 per cent.

Jill Reese, associate director at Sandersons estate agents, in Northallerton, said the rise in the stamp duty threshold from £60,000 to £120,000 earlier this year hasn't helped.

"The majority of houses in Hambleton are priced above £120,000, even for a two-bedroom property," she said.

"The area is desirable because of its location between the A1 and the A19 and the North Yorkshire Moors and the Yorkshire Dales."

North-East areas featured in the Halifax index include Wear Valley, Hambleton, Ryedale, Tynedale, Teesdale, Richmondshire, Selby and Alnwick.

The Wear Valley has been ranked the third cheapest rural local authority nationwide, with house prices averaging £119,563, and the most affordable in the North-East in terms of house-buyers' average earnings.

Andrew Bellwood, director at the Stuart Edwards estate agency in Bishop Auckland, said: "Houses in the Wear Valley are affordable and that means we are attracting new buyers from across the region."

Martin Ellis, chief economist at Halifax, said: "It is very difficult for first-time buyers to get onto the housing ladder in rural areas.

"Prices are higher than in urban areas and the number of rural first-time buyers is in serious decline."

The index has come at a time when rural housing is moving up the political agenda. Last week, a new Government body - the Affordable Rural Housing Commission - was formed, which aims to find ways of helping people in rural areas get a home.

It is expected to consider the steps taken by the Yorkshire Dales National Park Authority to tackle a shortage of affordable housing for local people was identified.

Earlier this year, the authority introduced planning laws preventing houses being built as second homes or holiday cottages.

Alnwick, in Northumberland, which came out top in a survey by County Life magazine of the best places to live in England, has seen house prices increase by a massive 227 per cent in the past ten years.