Page last updated at 11:23 GMT, Monday, 15 September 2008 12:23 UK

House prices soaring above wages

House keys
Buying a home has become more expensive in the Highlands and Islands

The extent of the housing crisis in the Highlands and Islands has been revealed by a study by the Bank of Scotland.

It shows that local house prices are now almost six times higher than average wages.

The same figures show the average house price across rural Scotland is 13% higher than the average in urban areas.

Highland Council housing spokeswoman Margaret Davidson said the authority was trying to help increase the number of affordable homes in the region.

Previously in the Highlands and Islands, prices were approximately three and a half times greater than average wages.

Holiday homes

The study also revealed the Western Isles has seen the greatest rise in rural house prices over the past five years - but remain the least expensive in Scotland.

Graham Brown, director of charity Shelter Scotland, said more housing was needed to meet the demand for homes.

He said: "It needs to be affordable and it needs to be an alternative to people otherwise we are simply going to see people moving away and all the dislocation that causes to local communities, local services, schools and other things."

Ms Davidson agreed that more affordable housing was key and the council was keen to do more to tackle the problems caused by there being so many holiday homes in some areas.

Measures have included raising council tax on second homes and the money raised channelled towards providing low-cost housing.

Ms Davidson said: "Maybe we need to look at more imaginative things, like in Ireland, where in some parts of a village you can get a second home but other parts it's for folks who need to live there."

Rural housing 'less affordable'
13 Sep 08 |  Scotland
'Tough' market for rural houses
25 Aug 07 |  Highlands and Islands
Holiday homes tax move welcomed
27 May 08 |  Highlands and Islands

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