Home Lead StoryHow house price growth compares to the average income

How house price growth compares to the average income

by LLP Reporter
26th Jun 19 9:48 am

Estate agent comparison site, GetAgent.co.uk, has looked at how current market conditions have impacted homeowners financially over the last year and how house price growth compares to the average income.

GetAgent.co.uk used house price data from the latest UK house price index and the latest data from the ONS employee earnings in the UK to compare the net wage across the UK with the change in house price values.

The data shows that there are four areas of the UK where houses have earned their owners the average wage for the area, and then some, despite the remaining prevalence of Brexit uncertainty.

The best place to live in the UK over the last year is North Devon, with the average house price increasing from ยฃ221,095 to ยฃ245,504 in the last year – a jump of ยฃ24.410. This jump is ยฃ5,810 more than the average annual net income of ยฃ18,599 and a 131% wage increase for homeowners in the area.

The Derbyshire Dales is the second best place with annual house price growth at ยฃ31,058 compared to an average wage of ยฃ24,796. In the Cotswolds, homeowners have seen property prices increase ยฃ28,917, while the average wage is just ยฃ24,641.

Purbeck is the fourth and final area of the UK to see house price growth higher than the average wage, with prices up ยฃ20,847 compared to a wage of ยฃ18,145. Forest Heath, Rochford, Forest Dean, Blaenau Gwent, Redditch and Harborough have also made their owners between 77% and 90% of the average salary in a year.

London house prices have fallen by nearly ยฃ6,000 in the last year, 18% of the average wage in the capital. However, if you live in Haringey, Southwark or Camden, look away now.

The three London boroughs are the only areas to have seen prices plummet by more than the average wage in the borough. Haringey has seen a drop of ยฃ43,906 in the last year with an average wage of just ยฃ27,346. Prices in Southwark have dropped ยฃ42,822 compared to a wage of ยฃ29,191 and Camden has seen a drop of ยฃ52,063 with a wage of ยฃ43,244.

Eight other London boroughs have seen 50% or more of the average annual wage wiped off by house price decline in the last year and outside of London this stretches to another 13 areas. The worst of which is Tandridge where prices have dropped by ยฃ8,922, 71% of the average wage yearly (ยฃ31,067).

Founder and CEO of GetAgent.co.uk, Colby Short said, โ€œPainful reading for many with the result of prolonged market uncertainty essentially wiping out 50% or more of their yearly earnings. Those in Haringey, Southwark and Camden, in particular, wonโ€™t be best pleased as they have seen the value of their property fall faster than they can earn money.

“Thankfully, those already on the ladder will only feel this pinch on their pocket if they are looking to sell and with the long-term durability of the UK property market, they could see a reversal in fortunes by the time they do.

“As always, itโ€™s not a story of doom and gloom everywhere and some houses have actually been hard at work for their owners earning a healthy salary of their own over the last year.โ€

Annual house price increases above the average wage level and next best areas as a percentage of the average wage
Location Average Annual Net Salary Average House Price (April 2018) Average House Price (April 2019) House Price Growth (ยฃ) Difference between Salary & AverageHP growth House price growth to wage (%)
North Devon ยฃ18,599 ยฃ221,095 ยฃ245,504 ยฃ24,410 ยฃ5,810 131%
Derbyshire Dales ยฃ24,796 ยฃ252,263 ยฃ283,321 ยฃ31,058 ยฃ6,263 125%
Cotswold ยฃ24,641 ยฃ355,520 ยฃ384,438 ยฃ28,917 ยฃ4,277 117%
Purbeck ยฃ18,145 ยฃ310,688 ยฃ331,535 ยฃ20,847 ยฃ2,702 115%
Forest Heath ยฃ23,077 ยฃ198,385 ยฃ219,249 ยฃ20,864 -ยฃ2,213 90%
Rochford ยฃ25,209 ยฃ332,350 ยฃ353,447 ยฃ21,097 -ยฃ4,112 84%
Forest of Dean ยฃ21,279 ยฃ225,054 ยฃ242,474 ยฃ17,420 -ยฃ3,860 82%
Blaenau Gwent ยฃ18,224 ยฃ84,593 ยฃ98,956 ยฃ14,363 -ยฃ3,861 79%
Redditch ยฃ19,419 ยฃ199,782 ยฃ214,930 ยฃ15,148 -ยฃ4,270 78%
Harborough ยฃ26,432 ยฃ274,373 ยฃ294,721 ยฃ20,348 -ยฃ6,084 77%
             
United Kingdom ยฃ23,821 ยฃ225,750 ยฃ228,903 ยฃ3,153 -ยฃ20,668 13%
ย  ย  ย  ย  ย  ย  ย 
Annual house price decline above average wage level ย  ย 
Location Average Annual Net Salary Average House Price (April 2018) Average House Price (April 2019) House Price Growth (ยฃ) Difference between Salary & AverageHP growth House price growth to wage (%)
Haringey ยฃ27,346 ยฃ555,449 ยฃ511,543 -ยฃ43,906 -ยฃ16,560 -161%
Southwark ยฃ29,191 ยฃ517,934 ยฃ475,052 -ยฃ42,882 -ยฃ13,691 -147%
Camden ยฃ43,224 ยฃ866,438 ยฃ814,375 -ยฃ52,063 -ยฃ8,839 -120%
ย  ย  ย  ย  ย  ย  ย 
Largest house price decline as a percentage of average wage outside of London
Location Average Annual Net Salary Average House Price (April 2018) Average House Price (April 2019) House Price Growth (ยฃ) Difference between Salary & AverageHP growth House price growth to wage (%)
Tandridge ยฃ31,067 ยฃ448,006 ยฃ425,931 -ยฃ22,075.26 ยฃ8,992 -71%
Mole Valley ยฃ30,638 ยฃ497,835 ยฃ476,361 -ยฃ21,474.00 ยฃ9,164 -70%
Chichester ยฃ23,845 ยฃ381,762 ยฃ365,101 -ยฃ16,661.10 ยฃ7,184 -70%
West Oxfordshire ยฃ23,174 ยฃ332,236 ยฃ316,470 -ยฃ15,765.79 ยฃ7,408 -68%
North Hertfordshire ยฃ26,131 ยฃ352,785 ยฃ335,171 -ยฃ17,613.78 ยฃ8,517 -67%
North Dorset ยฃ21,043 ยฃ262,533 ยฃ248,872 -ยฃ13,660.55 ยฃ7,383 -65%
Harrogate ยฃ25,180 ยฃ287,109 ยฃ271,018 -ยฃ16,090.80 ยฃ9,090 -64%
New Forest ยฃ21,842 ยฃ341,973 ยฃ328,254 -ยฃ13,718.90 ยฃ8,123 -63%
Rushmoor ยฃ26,160 ยฃ289,963 ยฃ274,270 -ยฃ15,693.65 ยฃ10,466 -60%
Bracknell Forest ยฃ25,840 ยฃ344,939 ยฃ329,844 -ยฃ15,094.66 ยฃ10,745 -58%
ย  ย  ย  ย  ย  ย  ย 
London boroughs – Annual house price change as a percentage of annual wage
Location Average Annual Net Salary Average House Price (April 2018) Average House Price (April 2019) House Price Growth (ยฃ) Difference between Salary & AverageHP growth House price growth to wage (%)
Haringey ยฃ27,346 ยฃ555,449 ยฃ511,543 -ยฃ43,906 -ยฃ71,251 -161%
Southwark ยฃ29,191 ยฃ517,934 ยฃ475,052 -ยฃ42,882 -ยฃ72,073 -147%
Camden ยฃ43,224 ยฃ866,438 ยฃ814,375 -ยฃ52,063 -ยฃ95,287 -120%
Lambeth ยฃ32,265 ยฃ516,207 ยฃ488,610 -ยฃ27,596 -ยฃ59,861 -86%
Barnet ยฃ29,227 ยฃ541,502 ยฃ516,750 -ยฃ24,752 -ยฃ53,979 -85%
Kingston upon Thames ยฃ31,723 ยฃ493,941 ยฃ467,894 -ยฃ26,047 -ยฃ57,770 -82%
City of London ยฃ40,145 ยฃ732,351 ยฃ699,794 -ยฃ32,556 -ยฃ72,701 -81%
Ealing ยฃ29,642 ยฃ481,101 ยฃ459,796 -ยฃ21,305 -ยฃ50,947 -72%
Harrow ยฃ27,810 ยฃ465,391 ยฃ445,636 -ยฃ19,754 -ยฃ47,564 -71%
Islington ยฃ39,473 ยฃ637,412 ยฃ613,718 -ยฃ23,694 -ยฃ63,167 -60%
Wandsworth ยฃ41,726 ยฃ594,836 ยฃ569,833 -ยฃ25,004 -ยฃ66,729 -60%
Havering ยฃ25,593 ยฃ369,070 ยฃ357,770 -ยฃ11,300 -ยฃ36,892 -44%
Brent ยฃ24,711 ยฃ485,434 ยฃ474,540 -ยฃ10,893 -ยฃ35,604 -44%
Bromley ยฃ32,749 ยฃ440,859 ยฃ430,242 -ยฃ10,616 -ยฃ43,365 -32%
Redbridge ยฃ27,341 ยฃ412,072 ยฃ403,911 -ยฃ8,161 -ยฃ35,502 -30%
Tower Hamlets ยฃ34,792 ยฃ455,910 ยฃ447,895 -ยฃ8,016 -ยฃ42,808 -23%
Sutton ยฃ26,423 ยฃ375,827 ยฃ370,200 -ยฃ5,627 -ยฃ32,050 -21%
Bexley ยฃ26,878 ยฃ338,476 ยฃ333,317 -ยฃ5,159 -ยฃ32,038 -19%
Enfield ยฃ25,325 ยฃ396,942 ยฃ393,253 -ยฃ3,690 -ยฃ29,015 -15%
Lewisham ยฃ27,638 ยฃ409,634 ยฃ406,614 -ยฃ3,020 -ยฃ30,658 -11%
Westminster ยฃ53,821 ยฃ1,003,535 ยฃ998,912 -ยฃ4,623 -ยฃ58,444 -9%
Richmond upon Thames ยฃ42,250 ยฃ649,078 ยฃ650,897 ยฃ1,820 -ยฃ40,430 4%
Croydon ยฃ27,178 ยฃ368,281 ยฃ369,986 ยฃ1,705 -ยฃ25,473 6%
Hillingdon ยฃ24,049 ยฃ408,618 ยฃ410,386 ยฃ1,768 -ยฃ22,281 7%
Waltham Forest ยฃ25,408 ยฃ430,972 ยฃ433,158 ยฃ2,186 -ยฃ23,222 9%
Newham ยฃ22,713 ยฃ360,618 ยฃ364,292 ยฃ3,674 -ยฃ19,039 16%
Hammersmith and Fulham ยฃ39,314 ยฃ710,090 ยฃ718,767 ยฃ8,677 -ยฃ30,636 22%
Merton ยฃ34,377 ยฃ494,428 ยฃ502,107 ยฃ7,680 -ยฃ26,698 22%
Barking and Dagenham ยฃ22,007 ยฃ291,184 ยฃ299,029 ยฃ7,845 -ยฃ14,162 36%
Hounslow ยฃ25,757 ยฃ387,621 ยฃ398,170 ยฃ10,549 -ยฃ15,208 41%
Greenwich ยฃ32,009 ยฃ383,039 ยฃ396,529 ยฃ13,490 -ยฃ18,519 42%
Hackney ยฃ26,702 ยฃ529,850 ยฃ541,802 ยฃ11,952 -ยฃ14,750 45%
Kensington and Chelsea no data ยฃ1,325,081 ยฃ1,288,685 -ยฃ36,396 n/a n/a
ย  ย  ย  ย  ย  ย  ย 
London ยฃ31,114 ยฃ477,253 ยฃ471,504 -ยฃ5,749 ย  -18%

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