Polly - even less point buying a house that you can't afford. Mortgage misery is no fun at all, and everything costs more than estimated.
Gas and electric are rising alarmingly. As is petrol. Don't forget the dreaded council tax.
You need a life as well. :)
And EverClean is right - the 'cheaper' end of the market is seeing the highest per centage rises, and this will improve with the high demand for that sort of housing.
The smart thing is to buy a house you can afford, and make additional payments as when you can afford them, paying the mortgage off quicker. Or at least reducing it, so when you come to move up the ladder you will have more equity in the property.
Good luck!