YOUNG teachers are being priced out of jobs in London and parts of the south east because of spiralling house prices.

Researchers at the University of North London have been cataloguing the experiences of newly-qualified teachers who rely on head-teachers and friends to put them up when they start their first jobs.

While they eventually find rented accommodation, they soon realise they must move out of the capital if they want to settle down and buy a house.

Last year’s 20 per cent increase in house prices in London has created a crisis, according to one head, who is losing staff from his school in Richmond, south-west London, because they can’t afford to live near the school.

Another, Alan Davison of Mill Hill school, Barnet, north London, said: “I can’t afford to live here myself because housing is so expensive. It is very difficult for young staff, especially as the London weighting is derisory.”

The allowance for teachers employed in inner London is pound;2,316 a year and pound;1,524 in outer London. House prices in central London rose 21.5 per cent in 1999, the highest rise in the country, followed by outer London and the south east. But in north east England, the rise was only 5 per cent.

Last autumn, a typical semi-detached house in London was worth an average pound;155,000, nearly three times the price of a similar property in Yorkshire or the East Midlands. Assuming a teacher could even get a mortgage in the capital they would be looking at monthly repayments of pound;900, against only pound;315 in Yorkshire, said Alex Bannister, group economist for the Nationwide Building Society.

Schools are allowed to award additional points on the teachers’ pay spines for recruitment expenses. But with other pressures on resources, there is little evidence that many are doing so.

Local authorities are responding by offering incentive packages. Thurrock, in Essex, where a semi costs pound;95,000 - pound;23,000 more than the UK average - offers mortgage and rent subsidies to new staff and priority public housing for all teachers.

Teachers can also start work early, in June or July, and be paid through the summer holidays. Its handy Rough Guide to Thurrock entices new teachers by extolling the virtues of the M25, the “holiday atmosphere” of Southend on Sea - and shopping at Lakeside.

Some councils, such as Newham in east London, offer “part buy, part rent” deals on local housing association property. Newham and other boroughs also give new teachers the chance to earn money working as supply teachers in the summer after they leave college.

Barking and Dagenham has a purpose-built block with homes for 54 new teachers. Islington has 31 council flats which are reserved for teachers, nurses and medical staff who work in the borough.

Julie Savage, recruitment strategist for Teachers for London, said: “The situation is very difficult. There is great demand for social housing and it is expensive for councils to offer incentives to young teachers.”