The reaction of most readers to this headline will probably be – that cannot be right, house prices are far higher in Cornwall and yes they would be correct. House prices in 2014 averaged £184,000.
Aha so why the difference? Well its quite simple really – if you compare house prices in Cumbria with earnings you find that prices are about 6.3 times average earnings. If house prices in Cornwall were 6.3 times average earnings then house prices would be about £113,800.
Quite a difference – a much more affordable and realistic price.
So why are house prices so much higher than they should be?
1) Developers just don’t get the opportunity to build enough houses? Oh come on readers of this blog and ‘It’s Our Cornwall’ should be well aware that house building in Cornwall has been and continues to be far higher than it need be.
2) A higher proportion of second homes? A definite factor.
3) High population growth due to high levels of in-migration? A significant factor in Cornwall – with induced demand at a high level as houses get built they get sold.
4) House prices do not reflect local earnings? Quite they reflect the earnings levels of those who purchase second/holiday homes and also the capital available of those moving to Cornwall from more affluent areas.
So do we continue as before or strike out with different policy options?