Squeeze on home buyers – 10 areas where property prices have soared ahead of wages | Personal Finance | Finance
Soaring house prices over the past 10 years mean the typical property now costs more than eight times the average salary.
The disparity means millions of young people have been forced to give up their home-owning dream or take on huge mortgages.
Separately, many people have been priced out of owning a home in the areas where they were born and raised.
A new study has identified the 10 areas where property prices have outpaced increases in wages faster than anywhere else in the country.
The data makes clear that London remains the most unaffordable region where house prices in some areas are more than 15 times the wages of locals.
By contrast the North East is the only region of England where wages have increased at a faster rate than house prices.
The list is headed by London’s Barking and Dagenham where the median property price has doubled from £177,500 to £380,000 over the past 10 years. By contrast the median wage has crept up by £2,182 to £34,430.
The net effect is that the ratio of house prices to wages has more than doubled from 5.5 to 11.04.
Second place in the ‘unaffordability league’ goes to Hillingdon where average prices have jump from £265,000 to £495,000, while wages are up only marginally from £35,738 to £35,881. As a result the house price to wages ratio rose from 7.42 to 13.8.
Waltham Forest is placed third. There the average house price rose from £250,000 to £520,000, while wages went up from £28,447 to £34,641.
The net effect of these changes was to see the ratio of house prices to wages rise from 8.79 to a punishing 15.01.
Looking beyond London, Nottingham, Gedling, which is to the north east of Nottinham, and Slough are identified as areas where house prices have raced ahead of incomes.
David Burrows, Head of Getamover.co.uk, said: “Approximately 303 local authorities across .England have seen house prices rise at a higher rate than wages over the last decade, with the affordability of buying a home falling significantly in four London boroughs.
“This study shines a spotlight on the areas in which housing affordability is increasingly becoming more of a problem.
“With house prices falling at the start of 2024, it will be interesting to see whether purchasing a home becomes more of a possibility for aspiring homeowners across England over the next decade.”