Homes 'earning more than owners' in areas

Homes 'earning more than owners' in areas

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Homes in 18% of local authority districts have “earned” more than their owners over the past two years, research suggests.

The study by lender Halifax compared the growth in property values with people’s average take-home pay in 2016 and 2017.

It found that house price growth in Barnet outpaced average earnings in the London borough by £52,256 during the two-year period, the biggest difference in the survey.

North Hertfordshire had the second biggest gap at £40,903, while Canterbury, Guildford and Oxford also rated highly.

The percentage of areas where house price growth outpaced earnings fell, however, from 31% in 2016 to 18% in 2017.

There was also a clear divide between the north and the south, with 86% of affected areas being in London, the South East, South West or the East of England.

This is a slight fall from the 93% seen in the previous year.

None of the districts in the north east of England, Yorkshire and the Humber, Scotland and Northern Ireland were affected.

Other places where house price growth eclipsed average take-home earnings included Harborough in Leicestershire (£19,662); Ribble Valley in Lancashire (£8,217); Tamworth in the West Midlands (£3,226) and Denbighshire in Wales (£793).

Russell Galley, managing director at Halifax, said: “Over the past two years, we have seen house price growth and earnings converge at a national level, leading to a drop in the total number of areas where the average house price rise is greater than owners’ take-home earnings.

“Despite the slowdown in house price growth in southern England, it has still outpaced wages across most of the region.

“This means that middle earners are also facing a challenge getting on to the property ladder.”



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