Exclusive: New blow for house hunters as funding decimated

New figures have revealed 85m in central Government funding for housing schemes in the Leeds City Region will not be renewed next year, while the North Yorkshire Housing Strategy, which covers the entire county, expects to have its funding cut in half.

The gloom surrounding the national property market also deepened yesterday as the latest lending figures showed double digit declines for house purchases and remortgaging in October.

Lending for house purchases fell 12 per cent year-on-year to 6.7bn in the month, while loans for remortgages slumped 24 per cent to 3.1bn, according to the Council of Mortgage Lenders (CML).

Earlier this month, the Yorkshire Post revealed the region was facing the biggest housing crisis in post-war Britain, which has left tens of thousands of people priced out of the property market.

Now a new report, prepared for a meeting of council leaders from across Yorkshire, has warned that the loss of funding has "grave implications", many housing schemes being halted half-way through, while the construction industry will also be badly hit.

It adds that the widespread withdrawal of central Government support will hit vulnerable home-owners the hardest.

The Labour MP for York Central, Hugh Bayley, said: "This is very bad news indeed, for the high number of people that need housing and the construction industry which needs work.

"I am surprised at the scale of these cuts and it is very short-sighted. This will put extra pressure on housing lists which are already huge in some places, particularly York."

Among the central Government funding not being renewed next year is 5m for schemes in Barnsley, Calderdale and Wakefield, and 70m across West Yorkshire, expected to hit regeneration schemes across Aire Valley, York North West, Bradford and North Kirklees.

A Leeds City Region spokesman said they were still hoping to apply for additional funding through the Regional Development Fund,

The chairman of the North Yorkshire Housing Board, Richard Foster, said he was expecting a 50 per cent budget cut from 60m over the previous four years to 30m to cover schemes until 2015.

The chairman of the Humber Housing Partnership, Jane Evison, also warned that "huge cuts" were expected across East Yorkshire despite 11,000 people being on housing waiting lists.

Coun Evison said: "We have had a tremendous push to provide more affordable housing over the past few years and we will not be able to keep that momentum going as we would have wanted to.

"We have been doing regeneration schemes in areas like Goole, and while we will keep that going, we are not expecting any more money at all.

"We are looking at big, big cuts in central Government funding."

The Yorkshire and Humber region is facing up to the worst position for affordable housing in more than 60 years as shocking statistics revealed the chasm between workers' wages and house prices.

While the average house price in the Yorkshire and Humber region is now 153,736, the average income is only 19,000.

Prospective house buyers are faced with a yawning gap between incomes and money needed to secure a footing on the property ladder. In North Yorkshire, the scale of the problem is even more acute, average house prices almost 210,000 while average earnings last year were less than 19,000. The gross annual income required for a mortgage in North Yorkshire is almost 54,000.

The National Housing Federation, which represents 1,200 housing associations across England, has warned that the crisis is being compounded by a lack of new construction programmes, but the Department for Communities and Local Government was adamant the Government remained committed to tackling the lack of affordable housing.