The Halifax Bank has reported the average price for a house in the country is now almost £250,000, and that it is £30,000 more than the average price for a town house. Factoring-in the disparity in earnings between those living in the country and those in towns, the disparity is a double-whammy. The worst-affected part of the country is Cornwall where average prices exceed average earnings by a factor of ten to one. There are half as many first-time buyers in the country as in towns and cities. This is really not sustainable, but how and when will the adjustment come? Will it be another round of house price crashes? Is the bubble about to burst?

Part of the problem, I believe, is the buy-to-let market where investors have been able to out-bid first-time buyers and soak up a lot of the available property. The losers in that bidding war then become their unwilling tenants thus ensuring the investment was a sound one. Every first-time buyer who fails to buy a home is a prospective tenant to the one who bought it.

A second part of the problem is the level of city bonuses which drive up prices in London and cause outward migration to neighbouring cities, where the incomers in turn drive up prices. They drive out owners who buy property in the surrounding countryside, driving up prices there. Because more people living in the countryside are people working in the towns and cities, the law of unintended consequences comes into play. Those people are obviously mobile and routinely shop in the same towns or cities where they work, so rural businesses suffer.

Everyone at the bottom end of this heap ends up with fewer job prospects and find they can only afford to live in city slums. Wealth is not trickling-down, it’s being sucked-up.