Jump in affordable towns for key workers
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by Gill Montia
New research from Halifax shows that housing affordability has improved greatly for key public sector workers, since house prices peaked in September 2007.
According to the lender’s survey, two in five towns (41%) are now affordable, based on the average house prices to earnings ratio for nurses, teachers, fire fighters and the like.
The ratio needs to be below 4.0 to count as affordable and back in 2007, homes in just 3% of UK towns (12 towns in total) fell into this category.
However, in the past year alone 32 towns have become more affordable for keyworkers and only 15 less affordable – resulting in a 4% increase in the number of affordable towns overall.
In particular, Peterborough, Lincoln, Morpeth, Glasgow, Clacton on Sea, Coventry and Wakefield are more welcoming to key workers wanting to own their homes, whereas Hinckley in Leicestershire, Newcastle upon Tyne, Dover and Beverley in East Yorkshire have become less affordable.
Currently, Wales is the most affordable region in the UK, with an average house price to key worker earnings ratio of 3.6.
The North (3.7), Yorkshire and the Humber (3.8) and the North West (3.8) follow closely behind.
Unsurprisingly, Greater London (7.6) and the South East (6.6) are still the least affordable regions.
Halifax housing economist, Martin Ellis, comments: “A combination of house price declines and growth in earnings has contributed to this improvement in affordability.”
He adds: “However, house prices nationally have changed little in the past year, which together with pressure on public sector earnings, has resulted in only a modest improvement in home affordability for key workers in the past 12 months.”
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