Oxford has once again been named as the least affordable place to live in the UK, with the average house price standing at £361,469 – almost 11 times the local wage. And British cities are becoming even harder to live in as rising house prices push affordability to its limits. In fact, average affordability in UK cities is now on par with levels seen in 2009.
In figures released by Lloyds Bank, the average property price in UK cities is shown to have risen by seven percent over the past year, driving affordability down from 5.8 to 6.1 times gross annual earnings. This marks the second successive annual fall in affordability.
The Scottish city of Stirling is the UK’s most affordable location, with the average property price being £158,645. Meanwhile, due to the strong performance of its oil and gas sectors, Aberdeen has seen its house prices rapidly increase by 88 percent over the past decade – the biggest price gain of any UK city.
In the capital city, property prices have increased by 40 percent over the last five years thanks to strong interest from wealthy overseas buyers. An average property in Greater London is now 8.75 times average gross annual earnings.
People looking to invest in property may want to look north, though. The vast majority of affordable houses are shown to be located in the North of England, Scotland and Northern Ireland. And perhaps the slowing of sales last year in cities such as Cambridge, Greater London and Oxford is proof that buyers are being put off by high house prices in the South. In contrast, cities such as Cardiff, Belfast, Leeds and Liverpool all saw a rise in house sales in 2014. However, stronger house sales are also an indication that property prices are poised to increase.
The results of Lloyds’ research show an almost clear cut divide between the North and South of the UK as far as house prices go, with the South taking 17 of the 20 slots for least affordable locations. Meanwhile, 19 of the 20 most affordable cities are in the North.