Have successive lockdowns prompted you to look for a new home with more space? Our research reveals where you can find the most affordable properties.

The quaint town of Shildon in County Durham has retained its crown as Britain’s most affordable town.

Homes in Shildon, which is just 13 miles from Durham, cost an average of £59,468, the equivalent of just 1.1 times local average earnings, according to our research.

Cleator Moor, in Copeland, on the edge of the Lake District, took the second-place spot, with properties there averaging £96,269, or 1.16 times local household earnings, followed by Kilbirnie in North Ayrshire with homes costing £76,303, giving a price to earnings ratio of 1.22.

Home movers looking to step up the housing ladder in one of the top two most affordable locations would spend an average of just 5% of their annual household income on mortgage repayments, assuming they borrowed 65% of the property’s value over 25 years at a rate of 2.11%.

First-time buyers would need to spend 7% of their household income on average if they put down a 15% deposit.

Cumnock in East Ayrshire and Egremont in Copeland completed the top five.

Scotland and northern regions dominated the top 10. Stevenston and Irvine in North Ayrshire and Girvan in South Ayrshire also made it into the ranking, as did Ferryhill in County Durham, where the dominance of terraced housing helps to keep average property prices lower.

For all of the towns in the top 10, home movers searching for a new property would not have to spend more than 6% of their annual income on mortgage payments, while first-time buyers would not need to spend more than 8% on average.

Grainne Gilmore, head of research at Zoopla, said: “This data shows where buyers can benefit from some of the most affordable markets across the country, especially movers who have built up some equity in their current home.

“Capital values in the north of England and Scotland are relatively lower than in the south of England, meaning that many of the most affordable areas are clustered in these regions.”

Shildon was also the most affordable town in the north east, while Cleator Moor took the title for the north west and Kilbirnie for Scotland.

Withernsea, in East Riding of Yorkshire, was the most affordable place in which to buy a home in Yorkshire and Humberside, with property prices averaging £119,148, giving a price to earnings ratio of 2.07.

Gainsborough in West Lindsey offered the best value in the East Midland, while Telford was the most affordable town in the West Midlands and Ferndale, in Rhondda Cynon Taff, where homes average £77,421, took the title for Wales.

Our study also uncovered pockets of affordability in more expensive southern regions.

Cinderford, in the Forest of Dean, was the most affordable location in the south west, with house prices averaging £190,707 or 3.16 times local incomes, with Dover the most affordable place to buy a property in the south east and Purfleet in Thurrock heading the table in the east of England.

The London borough of Barking and Dagenham offers the best value in the capital, with homes costing around 5.4 times local average pay or £341,432.

10 towns where affordability has improved the most

There is good news for buyers across the country, with affordability improving in pockets across all regions.

Affordability improved most in Cleator Moor and Egremont, which both featured in the top 10 most affordable towns.

Other places that have seen the biggest improvements are Whitehaven and Millom, also both in the north west.

The robust manufacturing sector and the Sellafield nuclear power station, a major employer in the area, underpins this local economy.

For buyers on the hunt for a home near an area of outstanding natural beauty, the price to earnings ratio in the spa town of Malvern has dropped from 4.14 to 3.73.

In southern England, Hoddesdon in Hertfordshire, which has average house prices of £396,623, offers an affordable alternative for those working in London, with the train to London Liverpool Street taking just 40 minutes.

Nearby Waltham Cross has also seen an improvement in affordability, with property prices averaging 5.28 times average local earnings.

Areas in North Devon have also become more affordable, with Bideford, which has an attractive quay and average house prices of £238,116, and Torrington both making it on to the list.

Most affordable pockets in the UK’s major cities

Although city locations are often associated with higher house prices, Britain’s largest cities still have areas that are more affordable.

In London, Barking and Dagenham, Bexley and Tower Hamlets all have properties costing less than 5.7 times the average annual salary for a two-earner household.

In Greater Manchester, properties in Coldhurst in Oldham, have an average house price to average earnings ratio of just 2.01 and a price tag of £104,416. 

Lozells is the most affordable area of Birmingham, with properties typically costing £141,431 or 2.5 times average local household earnings.

How affordable is your London neighbourhood?

The capital has a huge range in terms of property affordability, with homes in the most expensive boroughs costing three times more than those in the cheapest ones.

While Barking and Dagenham, Bexley and Tower Hamlets are the three most affordable boroughs in London, Greenwich, Havering and Croydon also have an average house price to earnings ratio of less than six.

Meanwhile, homes in 11 boroughs cost an average of less than seven times local earnings for a couple.

But London is also home to some of the least affordable property in the UK, with homes in Kensington and Chelsea having an average price to earnings ratio of 12.31, while properties in Hammersmith and Fulham, Barnet and Westminster have one of more than nine.

Methodology

Our research analysed average house price to earnings ratios, comparing the median house price (Zoopla house price estimates, December 2020) to average household earnings (the latest local-level ASHE data, April 2020, assuming two earners representing both genders). 

The mortgage repayments metric focused on the annual repayments based on the following assumptions:

  • Mortgage terms for home movers: mortgage rate 2.11%, 25 year term, 65% loan to value

  • Mortgage terms for first-time buyers: mortgage rate 2.11%, 25 year term, 85% loan to value

How Zoopla can help

Explore a wide range of affordable properties for sale on Zoopla, from new-build homes to older properties with history.

Use our range of handy tools to find exactly what you’re after. Take our Advanced Search tool - it allows you to search for homes with specific features, such as 'thatched roof' or 'bifold doors'. 

And register with Zoopla for instant email alerts for your preferred types of property - you can save as many searches as you want. 

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 The information and data in this article was correct at the time of publishing and every attempt is made to ensure its accuracy. However, it may now be out of date or superseded. Zoopla Ltd and its group companies make no representation or warranty of any kind regarding the content of this article and accept no responsibility or liability for any decisions made by the reader based on the information and/or data shown here.
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