Yorkshire and Humberside districts ‘among the more affordable for young homebuyers’

By comparing average local incomes for earners in their 20s and 30s with the typical prices of a less expensive starter home, the analysis shows that fewer than 25 per cent of young working households across the region would have difficulty affording a modest starter home. This compares with almost 50 per cent nationally.

The ‘access to ownership’ league for the region ranges between Richmondshire where 54 per cent of working households under 40 would be unable to purchase less expensive 'two‑up, two-down' homes in the district, to Hull where only 14 per cent experience the same problem. In Leeds, starter home prices are beyond the reach of 28 per cent of young working households, compared with 78 per cent across inner London. The equivalent figure for Sheffield is 21 per cent, 18 per cent for Bradford and just 14 per cent for Hull.

The new study also shows that, unlike the south of England, starter home prices in most Yorkshire and Humberside districts are low enough to be affordable by key workers. For example, in Hull, a qualified nurse, teacher, police officer or social worker with 3 years’ experience, would find the bottom 25 per cent of the price range for modest 4- and 5‑room homes well within their reach.

North Yorkshire stands out as the only part of the region where a single nurse's income is less than 100 per cent of the estimated level needed to start buying with a mortgage. But even in these districts a qualified teacher with 3 years’ experience should be able to afford a mortgage on a less expensive starter home.

The report, by Prof. Steve Wilcox of the University of York, presents three different ‘affordability’ indices comparing younger workers’ earnings with house prices for 4- and 5-room homes in every English borough and district. They cover:

The resulting league tables show that:

• House price to local income ratios for Yorkshire and Humberside were all below the average of 3.37 for England, with the exception of Richmondshire (3.68). Districts with the five highest ratios were: Richmondshire, Ryedale, Scarborough, Harrogate and Hambleton. The five lowest ratios were in Hull, Doncaster, North Lincolnshire, Rotherham and York.
• The access to ownership index showed that the region’s five most accessible districts for workers under 40 on average local pay rates to start climbing the housing ladder were: Hull, North Lincolnshire, Doncaster, Barnsley and Bradford. The five least accessible districts were: Richmondshire, Ryedale, Hambleton, Scarborough and Harrogate.
• The five most affordable areas for key workers were: Hull, Barnsley, Rotherham, North East Lincolnshire and Bradford. The least affordable districts for key workers (especially social workers and nurses) were Ryedale, Richmondshire, Hambleton, Harrogate and York. For instance, a qualified nurse with 3 or 4 years’ experience in Ryedale would have 80 per cent of the estimated annual income needed to start buying a less expensive starter home in the district. However, this compares with parts of London, the South, and Eastern Region where even two key worker incomes would not be enough to buy a modest house or flat.

Prof. Wilcox said: "Starter homes in Yorkshire and Humberside are generally much more affordable than those in London and the South East, yet there are still five districts – all in North Yorkshire - where a third or more of young working households cannot afford their first step into home ownership. House prices are much lower than in the South of England, but the ‘affordability’ gap also varies according the level of local incomes. For example, starter home prices in York are relatively high, but average income levels among young earners are the highest anywhere in the region – with the result that the local house price to income ratio is quite low. Richmondshire, by contrast, combines the region’s high house prices with the lowest average incomes to produce a ratio that rises above the average for England as a whole."

He added: "The position of key workers, such as nurses, teachers and police, is rather different because their pay rates are largely determined at national level. The good news across most of the region is that their individual incomes are adequate or very close to the level needed to raise a mortgage on a modest starter home."