Affordability in UK cities is at its worst level since 2007 but buyers who head to Scotland, the North of England and Northern Ireland should ease their purse strings a little.
While the average price of a city home has risen 36 per cent in the past five years to £233,000, average annual earnings rose just nine per cent to £33,420 in the same period, according to a report from Lloyds bank.
However, although Greater London recorded the highest average property price at £480,800, with Brighton and Hove it was joint third least affordable UK city thanks to marginally higher wages in the capital.
The least affordable city was Oxford, where the average house price of £430,000 was found to be 11.5 times average earnings.
Since the 2014 mortgage market review, which imposed tougher rules on lenders, it is usually not possible to borrow more than 4.5 times an applicant’s salary, meaning that in cities where the average house price is significantly higher than this, buyers will need a significantly higher deposit.
“City living suits the lifestyles of many people looking for shorter commutes with much of what they need on their doorstep, but buying a city property is the least affordable it’s been for a decade,” said Andy Mason, Lloyds Bank mortgage products director.
THE MOST AFFORDABLE UK CITIES FOR HOMEBUYERS
Buyers looking for a more affordable city home should head north, with all 20 of the UK’s most affordable cities outside southern England.
Stirling in Scotland is the UK’s most affordable city for the fifth year in a row with an average house price of £186,000 four times the average gross annual earnings.
With house prices 4.1 times earnings, Derry in northern Ireland was the second most affordable city, while Bradford in Yorkshire was the most affordable city in England with house prices 4.5 times average earnings.
York was the only northern city to rank as one of the least affordable cities with house prices eight times local wages.