Croydon comes out on top in London’s affordability rankings, according to new research by Zoopla.
To assist those who are thinking about buying a home in the coming months, Zoopla calculated which areas are the most affordable by analysing house value-to-earnings ratios, based on a two-earner household on an average salary for the local area.
The research reveals that despite annual earnings growing by 3.7 per cent over the last 12 months, outpacing house price growth, UK homebuyers can still expect to pay 3.8 times the average annual household incomes
It’s worse if you’re single: the 35 per cent of homebuyers who live on their own, will expect to pay 7.6 times their annual income on average.
Region |
Average house value (Oct 24) |
2024 value-to-earnings ratio |
2023 value-to-earnings ratio |
YoY change/improvement |
|---|---|---|---|---|
South West |
£326,500 |
4.3 |
4.5 |
4.9% |
South East |
£408,400 |
4.9 |
5.1 |
4.8% |
East of England |
£364,700 |
4.4 |
4.6 |
4.8% |
Yorkshire and The Humber |
£199,500 |
2.8 |
2.9 |
4.3% |
East Midlands |
£241,100 |
3.2 |
3.4 |
4.0% |
London |
£560,800 |
5.8 |
6.0 |
3.4% |
Scotland |
£171,700 |
2.2 |
2.3 |
3.0% |
North West |
£209,700 |
2.9 |
3.0 |
2.6% |
West Midlands |
£245,900 |
3.4 |
3.4 |
2.1% |
Wales |
£215,400 |
3.1 |
3.1 |
2.0% |
North East |
£146,500 |
2.1 |
2.2 |
1.6% |
Great Britain |
£307,600 |
3.8 |
3.9 |
3.7% |
Affordability ratios have improved by up to 5 per cent in some areas of southern England, but eight in ten British towns are still valued at more than four times local household average incomes.
Cumnock in Scotland, is Britain's most affordable town to buy in 2024 with average property values of £80,300, significantly below the UK average house price of £267,500
Over the last 12 months, house prices fell by two-thirds in southern England (excluding London), with the largest improvements in affordability in the South East, South West and East of England. Wisbech in Cambridgeshire and the coastal towns of Dover (Kent) and Great Yarmouth (Norfolk) are the most affordable places to buy in the south of England with affordability ratios in these areas ranging between 3 and 3.2.
However, affordability remains a significant challenge for many looking to buy in southern England, with eight in ten towns typically valued at more than four times the annual household income. In Scotland, 88 per cent of towns have a house value-to-earnings ratio under three however there is only one town in southern England where houses are valued at less than three times local household earnings - Wisbech in Cambridgeshire.
Region |
Postal town |
Average house value (Oct 24) |
Estimated annual household income (Sept 2024) |
House value-to-earnings ratio |
|---|---|---|---|---|
East Midlands |
Gainsborough |
£170,000 |
£70,500 |
2.4 |
East of England |
Wisbech |
£209,800 |
£70,900 |
3.0 |
South East |
Dover |
£250,000 |
£79,300 |
3.2 |
South West |
Plymouth |
£222,200 |
£68,300 |
3.3 |
Wales |
Ferndale |
£101,600 |
£67,700 |
1.5 |
West Midlands |
Stoke-On-Trent |
£139,200 |
£62,100 |
2.2 |
Yorkshire and The Humber |
Hull |
£119,800 |
£62,200 |
1.9 |
London |
Croydon |
£417,800 |
£84,800 |
4.7 |
North East |
Shildon |
£73,200 |
£65,800 |
1.1 |
North West |
Workington |
£123,700 |
£76,900 |
1.6 |
Scotland |
Cumnock |
£80,300 |
£75,800 |
1.1 |
In London, Croydon has the lowest house value-to-earnings ratio of 4.7, well below the London average of 5.8.
Greenwich, Barking and Dagenham, also see average homes valued at less than five times the local annual household income.
Those looking to stay close to London might consider the 33 towns within one hour of commuting distance to London terminals with lower value-to-household ratios than Croydon. The most affordable are Chatham (3.7), Southend (3.9) and Basingstoke (3.9).
Izabella Lubowiecka, Senior Property Researcher at Zoopla said, “Affordability remains a concern for many homebuyers so it is positive to see that there are areas of the UK, such as Southern England, where the affordability of housing has improved.
“London remains the least affordable area for home buyers. Those in London looking to get more for their money may want to consider buying in one of the South East and East of England’s commuter belt, where there are many towns that are more affordable than London. The same is true in markets around many regional cities and we see buyers seeking value for money. ”
