Recent research shows that properties in Croydon have “earned” more than their owners over the past two years as house prices have been rising much faster than wages.
Halifax conducted a comparison on rising property values against people’s average take-home earnings across the two-year period of 2016 and 2017 to make the findings. Croydon ranked in the top 10 places in the country for house prices outpacing average earnings with there being £27,386 between property price growth and wages.
This is good news for Croydon residents as the proportion of areas in the country where house prices outpaced earnings fell from 31% in 2016 to 18% in 2017, Halifax said.
Russell Galley, managing director at Halifax, said: “Over the past two years, we have seen house price growth and earnings converge at a national level, leading to a drop in the total number of areas where the average house price rise is greater than owners’ take-home earnings.
“Despite the slowdown in house price growth in southern England, it has still outpaced wages across most of the region.
“This means that middle earners are also facing a challenge getting on to the property ladder.”
The report also demonstrated the continuation of the north/south divide, with 86% of areas where the average house price rise is greater than local earnings being in London, the South East, South West or the East of England: this is down slightly from the previous year when 93% of areas came from these four regions.
According to Halifax’s report no district in the north east of England, Yorkshire and the Humber, Scotland and Northern Ireland saw average house price growth go beyond the average take-home earnings over the past two years.
The most expensive home sold in Croydon in January 2018 went for £1,230,000
Away from southern England, leading performers for house price growth compared with earnings incorporated Harborough in the East Midlands, with house price gains of £19,662 more than earnings, as well as the Ribble Valley in the North West (£8,217), Tamworth in the West Midlands (£3,226) and Denbighshire in Wales (£793).
According to Halifax, here are the top 10 places where house prices outpaced earnings across 2016 and 2017.
In the list below, the average increase in house prices over the two-year period is the first figure, followed by average take-home earnings in the same time and then the cash difference (figures have been rounded):
1. Barnet, London, £106,896, £54,641, £52,256
2. North Hertfordshire, East of England, £95,417, £54,514, £40,903
3. Newham, London, £75,304, £45,169, £30,135
4. Worthing, South East, £73,342, £43,472, £29,871
5. Canterbury, South East, £75,798, £47,454, £28,345
6. Croydon, London, £79,064, £51,678, £27,386
7. Guildford, South East, £77,664, £54,992, £22,672
8. Oxford, South East, £71,275, £48,761, £22,513
9. Fareham, South East, £67,799, £47,571, £20,228
10. Merton, London, £73,800, £53,784, £20,016