Property price rises are nothing new to anyone involved in making a purchase or arranging removals, but the speed at which house prices are increasing has been highlighted by a recent report in the Mail Online that compared the rises taking place over the last 12 months in different parts of the UK with the average annual salaries of the people who live there. In 33 of the regions that were investigated, the rise in property prices was more than the average salary, meaning that some of the homeowners in these regions might actually be earning more from their properties than they do from their jobs.
The average price rise in England and Wales over the last year was £10,809, which is less than half the average annual earnings, which were £22,045 in 2013. However, in many areas, the average rise in property prices has grown larger than the average earnings. House prices in London rose 17%, with property in the most valuable boroughs rising by astonishingly high amounts. In Westminster, where the average house price is now £976,822, properties gained an average of £160,810 over the last year alone. This is not just well above the national average earnings, but also much higher than the average earnings for people living in this area, which is £34,092. Properties outside of London, in areas such as Windsor, Maidenhead, Brighton, parts of Birmingham and the Vale of Glamorgan were also gaining more than the average annual earnings over the last year, although the effect was more subtle. The situation in the areas where TH Removals operates is similar. Although Hertfordshire came right at the bottom of the list, with the smallest difference, property prices in the area, growing at an average of £26,538 over the last year, still managed to rise above the average income, £25,993.
The fact that price rises are now higher than average incomes in many areas is great news for anyone who is already a homeowner, but it may pose some problems for buyers who are looking for a mortgage and planning their removals, particularly as lenders are now becoming more cautious about the ratio between incomes and loan sizes.