Wages have struggled to keep pace with home values and left some parts of the country without any affordable properties for sale at all, research from Shelter shows.
Exasperated by a lack of stock, rapidly rising house prices have left 95% of homes on sale in a third of local areas in England unaffordable to the typical working family.
In Brighton & Hove not one of the 1,662 homes on the market were found to be affordable for a family on average wages. It was a similar story in Cambridge, which had just 197 homes for sale but all were out of reach.
In many local areas, fewer than 10 homes on sale could be bought on the income of an average household, said the charity.
And the situation is even worse for single people looking for a home of their own: Across more than 80% of the country fewer than 10 in every 100 homes on the market were affordable.
The problem isn’t only a South East phenomenon. Just 2% of homes for sale were found to be affordable in West Somerset, 3% in York and 4% in Warwick.
Overall fewer than 10% of homes for sale across half the country are within financial reach for those hoping to buy for the first time, said the charity.
It compared asking prices of homes for sale in England with the mortgage that families, couples and single people on average wages could afford as first-time buyers.
Average house prices now stand at £247,000 - a record high - according to the Office for National Statistics (ONS).
But wages are failing to keep pace and have actually been decreasing in real terms. Earlier this year, the ONS said that wages in the UK have fallen back to 2003 levels, after adjusting for inflation.
In parts of London, the average house price is 12 times higher than the average wage. The graphic below shows how house price to earnings have changed since 1997.
The Government has this year launched its Help To Buy scheme to make 95% mortgage more widely available. It was hoped the scheme would help buyers who had little hope of stumping up the huge deposits required to get a mortgage.
However, as mortgages made to buyers with smaller deposits have higher monthly repayments, Shelter said the scheme often does not make homes more affordable to the average household.
There simply aren’t enough properties on the market that first-time buyers can afford, leading to years spent in expensive and unstable private lets, the charity said.
It has warned that unless the Government tackles the shortage of affordable homes, things are only going to get worse.
“When the number of affordable properties in an entire town can be counted on one hand, it’s not difficult to see why a stable home of their own is quickly becoming a distant dream for the next generation,” said Campbell Robb, Shelter’s chief executive.
“It’s right that young people who aspire to own their own home should work hard and save each month, but with such a pitiful number of affordable homes on offer - even with a generous 20% deposit – our housing shortage is holding them back.
“Unless we build the affordable homes we desperately need, house prices will continue to rise and as a result more people will be forced to live at home with their parents into their thirties, or move into the expensive and unstable private rental market.
“Young people are working hard and doing their bit. Now the Government has to meet people halfway and increase the supply of affordable homes - not the supply of credit - or the prospect of a home of their own will slip even further out of reach for future generations.”