'Pay outpaces house prices' in many areas

Cornelia Mascio
Settembre 13, 2017

Edinburgh and Birmingham are among the 54% of areas where pay has outpaced property prices since 2007, the Yorkshire Building Society found.

The findings, based on official earnings figures and Land Registry data for house prices in 356 local authority areas, come as the number of people departing London is at a five-year high, with net outward migration of 93,300 people in the year to June 2016, 80% higher than five years earlier.

Homeowners are facing a north south divide when it comes to housing affordability, research reveals.

Across London and much of southern England, it has become "increasingly hard for first-time buyers and those wanting to move up the housing ladder", said Andrew McPhillips, chief economist at the Yorkshire Building Society.

But the regional picture is more varied with an improvement in Scotland and Wales of 18.9 per cent and 17.2 per cent respectively, and a decline of 3.3 per cent in England.

Homes across half of the United Kingdom are more affordable than before the financial crisis, with Birmingham, Glasgow and Leeds among the places where the gap between earnings and house prices has fallen, a study has found.

"If you look at the areas that have improved, it's good in a sense that wages have increased quicker than property prices".

Also among the most affordable areas is Burnley in the north west of England, where the average house price has fallen from £94,174 to £77,629. There, the average house is now £191,829.64 compared to £201,692.83 in 2007.

Three areas of Scotland have seen the biggest shift in wages rising faster than house prices compared with 10 years ago, according to the analysis.

Just York, Craven and the East Riding are less affordable than they were a decade ago. Homes in the Three Rivers district council area, which is bisected by the M25, cost nearly 16 times average earnings, compared with 10 times in 2007.

The report shows that elsewhere in the country many areas are still unaffordable to first time buyers, with the average price of a home now more than 20 times the average wage in some parts of London.

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