Research by property developer, Stripe Property Group, reveals that in 2022, homes out-earned humans across half of all UK regions as annual house price growth eclipsed the average wage.
The latest figures from the Land Registry show that annually the average UK house price increased by £33,089 last year, up from £263,333 to £296,422.
At the same time, the average UK person took home a gross annual income of £33,402, just £313 more than their home made over the course of the year.
However, in six of the twelve UK regions, houses actually earned more than human beings. In some cases, dramatically more.
In the South West, the average house price increased by £44,102 while the average person earned just £30,653. This is a difference of £13,449 in favour of houses.
In the South East, houses out-earned humans by £6,657 and in the East of England, the level of house price growth trumped the average annual income by £2,595. Houses also earned more in the West Midlands (£1,992), East Midlands (£900), and North West (£234).
Looking forward, it seems that homebuyers face a difficult task based on the fact that between 2021 and 2022, house prices increased by 12.6% while wages increased by just 6.3%. As such, property that was already unaffordable a year ago is getting even further out of reach.
Managing Director of Stripe Property Group, James Forrester, commented:
“Despite the wider doom and gloom surrounding the property market at present, the fact of the matter is that house prices remain substantially higher than they were a year ago. So much so, that in many areas they’ve increased by more than the average person earns in a year.
Of course, it’s not just the robust nature of the property market that’s driving this performance, with growth with respect to what we earn failing to keep pace.
This presents a double pronged problem for those looking to climb the ladder, particularly with the current cost of living crisis, as not only are they struggling to accumulate enough savings, but the hurdle to homeownership is only growing larger by the day.
One way to ease the burden on new buyers is to introduce more homes to market, thus bringing more balance to the supply and demand imbalance. This will help reduce overall prices without having to rely on broader economic trends working in favour of buyers instead of owners.”