City house prices rise as councils try to find space for new homes

city living has become less affordable over the last year - and York is among the least affordable placies in the country, a report has found,

The price of a home in a large town or city has grown by five per cent over the last year to reach £184,215 on average or 5.8 times someone’s average earnings according to research by Lloyds Bank.

Stirling in Scotland and Londonderry in Northern Ireland were named as the UK’s most affordable cities to live, with Bradford, Hull and Sheffield not far behind.

Hide Ad
Hide Ad

At the other end of the spectrum, Oxford was found to be the least affordable, with people there facing a property price tag which is over 11 times the local wage, followed by Winchester.

York was the only northern city to make the line-up of the UK’s least affordable cities, at number 20. A home in York costs nearly six times average wages, while one in Hull and Sheffield would set someone back just over four and-a-half times their earnings.

The UK housing market has picked up sharply in some areas over the last year amid Government schemes which have unleashed fresh demand from people who had struggled to get a mortgage.

But critics have argued that the supply of homes coming is not keeping up with growing demand, which they say is putting an upward pressure on house prices and putting some buyers in danger of over-stretching themselves.

Hide Ad
Hide Ad

Pundits have said mortgage borrowers should start thinking now about how they will cope when the Bank of England base rate starts to climb. The bank rate has been at a historic low for five years, helping keep mortgage payments relatively affordable.

Marc Page, Lloyds Bank mortgages director, said: “Over the last five to 10 years, affordability has marginally improved in most UK cities, as increases in earnings have kept up with house price rises in that time.

“However, the economic and lifestyle benefits often associated with residing in cities are continuing to drive demand, especially in the south of England. With city house prices continuing to rise, affordability deteriorated slightly last year, but the trend since 2009 is positive for the majority of UK cities.”

Council leaders in Yorkshire said they were working hard to encourage housebuilding.

Hide Ad
Hide Ad

Councillor Dave Merrett, who oversees planning for York Council, said the city also had some of the highest rents. The draft local plan has identified sites for 22,000 new homes over 15 years, he said.

A cut in the amount of section 106 monies paid by housing developers towards council services would help stimulate housing developments.

“The first three-quarters of the year has seen 1,291 housing units approved, a level not seen since 2007.”

Bradford Councillor Val Slater, who is in charge of plannning, said: “We are looking to encourage an extra 3,000 people to live in the city centre. The fact that Bradford is an affordable place to live is good news but also shows we are a low wage economy. We do have a housing crisis - at least 10 per cent of homes are overcrowded.”

The council is proposing to encourage developers to convert city centre buildings for housing by cutting planning red tape, she added.