Most and least affordable UK cities in 2021 revealed

A 10.3% surge in city house prices over the past year has worsened the affordability of city living, Halifax said.

Most and least affordable UK cities in 2021 revealed

Buying a home in a UK city will typically set a buyer back by more than eight times average earnings, analysis has revealed.

A 10.3% surge in city house prices over the past year now sees the average property costing 8.1 times average earnings, Halifax found.

While the average city house price increased to £287,440, average earnings in these locations increased by only 2.1% annually, to £35,677.

After sitting at 5.6 from 2011 to 2013, the house price-to-earnings ratio in UK cities has increased for eight years in a row.

However, cities still tend to be marginally more affordable than the UK as a whole, which has a house price-to-earnings ratio of 8.5.

Wages in cities are often higher than in rural areas, and during the coronavirus pandemic many city dwellers have relocated to the countryside, helping to push up house prices there.

Londonderry held its position as the UK’s most affordable city for the third year in a row, with a price-to-earnings ratio of 4.7.

Londonderry
A general view of Londonderry, which has been identified as the UK’s most affordable city to buy a home (Paul Faith/PA)

London was outside the top five least affordable cities for the first time in six years.

Russell Galley, managing director, Halifax, said: “Affordability is significantly better in the north and there are now just two cities – Plymouth and Portsmouth – with better than average affordability in the south.”

Housing affordability improved in seven cities compared with a year earlier: Oxford, Carlisle, Portsmouth, Durham, Salford, Inverness and Glasgow.

Carlisle and Aberdeen are now more affordable than five years ago, with their house price-to-earnings ratios easing.

Inverness
House prices in Inverness are more affordable compared with 10 years ago, when comparing property prices with earnings, Halifax said (Jane Barlow/PA)

Here are the top 20 most affordable cities in 2021, according to Halifax, with the price-to-earnings ratio followed by the average house price and average annual earnings:

1. Londonderry, Northern Ireland, 4.7, £155,917, £33,138

=2. Carlisle, North, 4.8, £163,232, £34,087

=2. Bradford, Yorkshire and the Humber, 4.8, £164,410, £34,219

=4. Stirling, Scotland, 5.4, £208,927, £38,744

=4. Aberdeen, Scotland, 5.4, £205,199, £38,016

=4. Glasgow, Scotland, 5.4, £196,625, £36,205

7. Perth, Scotland, 5.5, £203,229, £36,700

=8. Inverness, Scotland, 5.6, £191,840, £34,373

=8. Hull, Yorkshire and the Humber, 5.6, £156,424, £27,730

10. Dundee, Scotland, 5.8, £181,150, £31,344

11. Sunderland, North, 6.0, £179,567, £29,745

12. Lisburn, Northern Ireland, 6.1, £203,386, £33,138

=13. Salford, North West, 6.2, £211,903, £34,444

=13. Durham, North, 6.2, £196,274, £31,762

=13. Liverpool, North West, 6.2, £215,741, £34,911

=13. Belfast, Northern Ireland, 6.2, £205,228, £33,138

=13. Lancaster, North West, 6.2, £217,392, £35,004

18. Newcastle-upon-Tyne, North, 6.3, £229,434, £36,212

19. Stoke-on-Trent, West Midlands, 6.5, £200,161, £30,698

20. Hereford, West Midlands, 6.6, £316,929, £48,048

Here are the top 20 least affordable cities in 2021, according to Halifax, with the price-to-earnings ratio followed by the average house price and average annual earnings:

1. Winchester, South East, 14.0, £630,432, £45,059

2. Oxford, South East, 12.4, £486,928, £39,220

=3. Truro, South West, 12.1, £356,788, £29,558

=3. Bath, South West, 12.1, £476,470, £39,508

5. Chichester, South East, 10.6, £446,899, £37,352

6. Cambridge, East Anglia, 11.9, £482,300, £40,492

7. Brighton and Hove, South East, 11.6, £449,243, £38,737

8. London, South East, 11.0, £564,695, £51,257

=9. St Albans, South East, 10.2, £604,423, £59,391

=9. Chelmsford, South East, 10.2, £424,690, £41,781

11. Salisbury, South West, 10.0, £392,355, £39,154

12. Exeter, South West, 9.9, £323,554, £32,635

13. Leicester, East Midlands, 9.7, £279,080, £28,725

14. Norwich, East Anglia, 9.4, £306,946, £32,632

15. Bristol, South West, 9.3, £346,902, £37,357

=16. Southampton, South East, 9.0, £310,435, £34,429

=16. Canterbury, South East, 9.0, £365,168, £40,565

=16. Gloucester, South West, 9.0, £287,600, £31,987

19. Worcester, West Midlands, 8.8, £303,132, £34,389

20. Cardiff, Wales, 8.7, £276,851, £31,946

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