RURAL Dorset and the New Forest could become the exclusive preserve of the old and wealthy, it is feared.

A report has sparked fears that rural England could become a "rainy version of Palm Springs", with an elderly population and declining services.

The Countryside Agency found rural homes are much less affordable than those in towns, with more than 57 per cent of country dwellers having to commit more than half their income to housing.

Cllr Tim Palmer, leader of Dorset County Council, echoed fears that young people could be priced out of the countryside, threatening the viability of local services.

"There are examples like Palm Springs where this sort of thing's happened. It's not an impossibility," he said.

"In Dorset we have south western wages, which are relatively low, with south eastern house prices, so we're caught in a pincer movement."

House prices in Dorset are 16 per cent above the national average, while wages are 14 per cent below average.

The average house in Dorset was priced at £146,000 three months ago, with the average weekly wage at £364.

Cllr Palmer said the county council was trying to help by passing any unused borrowing facilities on to local housing associations. He said the problem was aggravated by a poor spending settlement from government, which hit elderly people struggling to pay for their housing.

Ewen Cameron, chairman of the Countryside Agency, has said the lack of affordable housing threatens to undermine the future of many rural areas.

New Forest West MP Desmond Swayne says the Countryside Agency's bleak vision could become reality if the rural housing situation is not managed properly.

"There are definite dangers for leafy villages, with many lifelong residents no longer able to afford average house prices in some areas," he said.

"It is vitally important to maintain a good population mix, or traditional village infrastructures will disintegrate. There just won't be the demand for normal high street services.

"But I don't think the problem is so acute in the New Forest, partly because the district council is demanding a good proportion of affordable housing from developers.

"And I've also been quite encouraged by the movement of young families into what have been traditional retirement areas on the coast, such as Barton-on-Sea, so it is not all doom and gloom."