West of Wales sees biggest ‘biggest deterioration in house price affordability’ of whole UK
The west of Wales has seen the “biggest deterioration in house price affordability” over the last two years, new figures show.
Pembrokeshire was the county worst hit in the whole of the UK for house price affordability, with Carmarthenshire and Ceredigion also in the top five.
The impact of surging property prices throughout the pandemic has reduced housing affordability to the lowest level on record, according to new research by Halifax, the UK’s biggest mortgage lender.
Halifax said that Pembrokeshire had been particularly hard hit as buyer demand has soared in rural locations offering greater space during the pandemic.
The house price to earnings ratio in Pembrokeshire has risen from 4.3 at the beginning of 2020, to now stand at 6.9 (+2.6).
In Carmarthenshire and Ceredigion people who needed 4.6 their earnings to buy a home now needed 6.5 their earnings to do so, two years later.
‘Continue to grow’
Wales as a whole had seen the ratio shift from 5.3 times the average earnings to 6.5 times. In practice, however many will be earning considerably less than the ‘average’ earnings of £32,467 used to calculate the figures.
Overall, Wales was the sixth least affordable part of the UK to buy a home, out of 12 nations and regions.
London was the least affordable with a 9.7 house price to earnings ratio. The north east of England was most affordable with a 4.6 house price to earnings ratio.
Andrew Asaam, Mortgages Director, Halifax, commented: “There’s no question that the economics of buying a home have changed significantly over the last couple of years. Soaring property prices and slower wage growth have combined to stretch traditional measures of housing affordability.
“However, we also know from strong transaction levels that demand has remained extremely strong over that period, both from home-movers seeking bigger properties, and first-time buyers taking their first steps onto the ladder.
“With interest rates on the rise as a means of combatting inflation, it’s unlikely that house prices will continue to grow at the pace we’ve seen recently. This should see the gap between average earnings and property prices narrowing over time.
“It’s also important to highlight the responsible approach taken to mortgage lending in this environment, with lenders conducting thorough checks to ensure repayments are manageable even if interest rates rise more sharply in future.”
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Independence asap. Tory Gov. fit for purpose; their own!
senned tourist tax in action. driving up house prices. the assembly needs to understand the importance of tourists!
What tourist tax?
The real Cynan could spell Senedd