90% of London earners lack the income to buy in the city

Ryan Bembridge

January 4, 2018

Only 10% of earners in London have the income to buy property in the city once they have a 20% deposit, according to stark data from Nationwide.

Just one in 10 earn enough to buy a typical first-time buyer property with a mortgage at four times income.

It would also take those earning enough 10 years to raise a deposit when saving 15% of their take home pay.

In the South East the top 20% of earners could afford to get a mortgage, while in Scotland and the North of England the top 70% would be able to afford it.

Robert Gardner, chief economist at Nationwide, said: “The variation in affordability across regions has increased over the past 10 years.

“Affordability has improved in Wales, Scotland and the North of England, but the most marked improvement has been in Northern Ireland, where the typical buyer has moved from the 90th percentile to the 40th percentile.

“This is largely due to the significant correction in house prices in Northern Ireland, which are still around 40% lower than in 2007.

“Meanwhile in London and the South East, affordability has become even more challenging, with more people priced out of the market or needing to borrow a greater multiple of their income.”

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