The housing market has boomed in the last year, but some areas have grown in value far more than others. Londonderry tops the list as the most affordable. Here’s the lowdown on the cheapest and most expensive areas in the UK.

Halifax has released a list of the most affordable and most expensive areas in the UK. The lender has based its figures on a 12-month period to June 2021 and has found that, while city house prices rose to an average of £287,440 – an increase of 10.3 per cent – wages in the same locations only increased by 2.1 per cent to an average of £35,677. This may make it more of a challenge to buy in certain areas unless your pay rise has been significantly higher than the average increase in the past year.

House price growth

‘Rising house prices have generally continued to outstrip wage growth, which reduces overall affordability, however, the picture is mixed for buyers,’ says Russell Galley, Managing Director of Halifax. ‘For city home-movers who want to stay in their area, the level of equity in their current property is likely to be an important factor in how affordable the local area is for them, whereas raising a deposit remains an issue for many first-time buyers. Nevertheless, some areas, like Carlisle, saw affordability improve, and cities like Bradford and Glasgow are some of the most affordable in the country.’

According to Halifax, the UK’s most affordable cities are Londonderry in Northern Ireland, Carlisle, Bradford, Stirling, Aberdeen and Glasgow. Average house prices in these areas range from £155,917 (Londonderry) to £196,625. Other affordable areas include Perth, Inverness, Hull, Dundee and Sunderland.

Most affordable city

Londonderry has retained its status as the most affordable city for the third year in a row, with a Price to Earnings ratio (PE) of 4.7. Winchester has become the UK’s least affordable city, replacing Oxford, with house prices now 14 times the annual earnings for those living and working in the city. A property in Winchester will now cost an average of £630,432 – an increase of 8 per cent on last year.

UK cities that have seen the highest house price growth in the 12 months to June 2021 include Salisbury, where the average house price is now £392,355 (up from £288,692 in 2020) and Hereford, where the average house price is now £316,929 (up from £245,304 in 2020).

These areas are closely followed by Lancaster where average prices are now £217,392 (compared to 181,940 last year) and Birmingham, where average prices are now £249,692 (up from £210,134). In one year, Salisbury has seen an average price increase of 36 per cent and Hereford 29 per cent.

Other areas that have seen the highest house price growth in the last year include Truro, Wolverhampton, Gloucester, Bath, Newport and Sunderland. In Truro, average prices have risen by 18 per cent, up from an average of £302,579 last year to £356,788 this year. 

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