The average house in the UK earned more than the average worker in the last year, according to the Post Office’s Cost of Buying & Moving study.
The research found house prices increased by 12 per cent – or £29,339 – over the last twelve months, while the average worker took home earnings of £27,271. Overall more than 60 per cent of the working population earned less than the average home in the last 12 months.
A typical home’s earnings now exceed the starting salaries of a junior hospital doctor (£22,636), a graduate nurse (£21,388), a teacher (£22,023), a police officer (£23,317) and a solider (£17,945).
John Willcock, head of mortgages at Post Office, comments:
“Property prices have soared over the last year, following a long period of recovery – and are set to increase further over the next five years. Whilst this is good news for those that already own their home, our study highlights the struggle that buyers and movers looking to climb the property ladder face, especially in getting on that all-important first rung.”
Homeowners in the East, South East and London saw their earnings outclassed the most – with properties in each region earning £34,002, £35,188, and £80,462 respectively. Houses in the nation’s capital earned £80,462 – almost twice as much as the average London salary (£41,095). They earn more than the average earnings of a fully qualified doctor in the UK (£70,648).
However Willcock says house prices will likely contract slightly over the next year, in response to the Mortgage Market Review (MMR) and falling demand from overseas buyers.
“One of the impacts of MMR is a lengthening in transaction times and more rigorous criteria, meaning the overall process of buying and moving is taking longer. However, as demand for properties remains high those on the hunt for first homes and dream properties will continue to face substantial costs.”
