The fact that residential property prices have increased twice as quickly as household incomes in England in recent year is a major issue that needs addressing, a Labour MP has warned.
New government data shows that the average annual disposable household income was £35,000 during the financial year ending 2023 in England; the average house price was £298,000, which is the equivalent to a ratio of 8.6 years of household income.
The average house price to disposable household income ratios were 5.8 in Wales, 5.6 in Scotland and 5.0 in Northern Ireland in FYE 2023.
Since this series began, house prices have increased twice as quickly as household incomes in England; house prices in Wales and Scotland have also increased more rapidly than incomes, but the differences are more moderate.
For low-income households, average-priced homes in all four countries have been “unaffordable” (costing more than five years of income) throughout the series.
Only the 10% highest-income households in England could afford an average-priced home with fewer than five years of household income in FYE 2023; in Wales this was the top 30%, the top 40% in Scotland, while in Northern Ireland an average-priced home was affordable with an average household income.
In London, the average home was not affordable for any household income decile; in three other regions, the average home was only affordable to the top decile.
Chris Curtis, a Labour MP on the housing select committee, commented: “These figures demonstrate the staggering scale of our country’s housing crisis and underline the urgency of the task facing this government to end it.
“It is quite frankly shameful that house prices have risen at double the rate of household incomes over the past 20 years. To halt is this trend we need grow our economy so that rising pay-packets mean it’s not just the privileged few who can afford to get on the housing ladder.
“Alongside this we need to be truly radical in reforming the broken planning system and explore innovative solutions to crowd private investment into building more affordable and social housing.”
