The surge in house prices has seen many potential buyers struggle to get on the property ladder, but new research has shown several affordable locations where buyers can purchase a home with a salary of around £20,000.
The UK property market has seen its fastest annual growth in two years, with house prices rising by 3.2 per cent in September compared to the previous year.
Although the regional differences in housing costs across the country can be steep, the research offers pockets of affordability and a glimmer of hope for first-time buyers and those looking to downsize.
According to Zoopla data, Inverclyde in West Central Scotland tops the list of affordable areas, with an average house price of just £106,100. Buyers earning £20,040 annually could potentially purchase a property here, based on borrowing 4.5 times their income.
East Ayrshire follows closely, with typical values of £106,800, requiring a salary of £20,160. West Dunbartonshire ranks third, where homes average £110,000 and buyers need an annual income of £20,770.
In England, Hartlepool offers affordability with an average price of £114,100, accessible to those earning £21,550 per year. Blackpool and Burnley also feature on the list, with average house prices of £123,600 and £120,100 respectively.
The housing crisis should be a top priority for the next government PAScotland dominates the list of affordable areas, with half of the top 20 cheapest postcodes located north of the border. The PA25 postcode in Cairndow, Argyllshire, boasts the lowest average asking price at just under £55,000 in 2023.
Renfrewshire, Glasgow, and North Ayrshire all offer properties with average selling prices below £130,000.
In England, Berwick Hills in Middlesbrough (TS3) ranks as the most affordable location, with an average asking price of £95,104.
Wales’ most budget-friendly option is Ferndale (CF43), where property prices average £118,990.
Other affordable areas include Kingston Upon Hull, North Ayrshire, and Sunderland, requiring annual salaries between £21,630 and £23,000 to purchase a home.
These affordable areas stand in stark contrast to the average UK house price, which currently sits at £329,648. The disparity is even more pronounced when compared to London, where the average property costs £524,685 – more than three times higher than in Northern England.
The North-South divide is evident, with all southern regions, except East Anglia, showing higher average prices than their northern counterparts.
Despite recent gains, flats remain the most affordable property type, potentially offering opportunities for first-time buyers and investors.
East Anglia stands out as the only UK region to record an annual price fall, with prices down 0.8 per cent year-on-year, suggesting potential opportunities for buyers in this area.
Robert Gardner, Nationwide’s Chief Economist said: “Income growth has continued to outstrip house price growth in recent months while borrowing costs have edged lower amid expectations that the Bank of England will continue to lower interest rates in the coming quarters.”
The Bank of England’s recent interest rate cut, the first in four years, has led to a drop in mortgage rates. The average two-year fixed-rate mortgage now stands at 5.46 per cent, down from 6.59 per cent a year ago.
These factors, combined with the potential for further rate cuts, may improve affordability for first-time buyers in the coming months.