Unaffordable London house prices push first-time buyers to the north
House prices across the UK have shown signs of rebalancing as prices come down in the capital and jump in the North West and Yorkshire.
London has a house price to earnings ratio of 8.22, making it one of the least affordable places to live in the country, against a national ratio of 6.55.
Seven of the ten areas with the lowest house price growth 2023 to 2024 were in the capital, making London the city with the least house price growth this year, according to data from Halifax.
Prices in Ealing, for example, dropped 4.9 per cent, while in Southwark prices dropped 4.8 per cent.
“The high asking price for London properties means house prices have fallen in several boroughs – perhaps a reflection that the relatively high cost of properties is stretching affordability for buyers,” Head of mortgages at Halifax, Amanda Bryden, said.
Overall, the South East lagged behind the rest of the UK, with movement of just 1.8 per cent, compared to 6.3 per cent for the UK overall.
“Much like London, first-time buyers won’t find a bargain here, as the slow growth is likely a consequence of the already-high property prices, relative to the national average,” Bryden said.
House prices in Greater Manchester soar
House prices in Oldham, just outside of Manchester, rose 14.6 per cent this year to £250,546 – growth of £31,951 year on year. In neighbouring Bolton, house prices rose 12.9 per cent to £252,070.
Bryden said the growth in these areas was due to a rebalancing of prices nationally. With more affordable areas like Oldham and Bolton still coming in under the national average, they’re much more attractive to first-time buyers.
London still top of the tree
The value of a house in London still dwarfs the UK’s second city: the average house in London cost £523,000 in July 2024 versus £234,000 in Manchester.
Demand in Slough – famously the site of The Office – also soared, with seven in ten house purchases made by first-time buyers. House prices rose by just under 15 per cent, the second-highest growth in the UK.
Out of the top ten areas with the fastest house price growth this year, none were in major cities.