The unafforda-bubble: Camden homes cost almost 11 times average earnings
PUBLISHED: 13:00 23 June 2017
Buying a home in Camden will cost you 11 times average earnings in the area, but it’s still the tenth most affordable borough in London
The house price to earnings ration in Camden is 10.95, making it the 10th most affordable borough in London.
The average price of property in the borough according to Zoopla.com is £946,518, and rising.
Across London homes cost 11.4 times the average salary in the capital.
House prices in London cost on average over half a million pounds at £553,068 with average wages of just £49,140 according to a report by sellhousefast.uk based on figures from the Office for National Statistics.
Brent fared the worst in terms of affordability, with residents stumping up 15.9 times their average income to buy a home at an average of £494,913.
Hackney came in third from the bottom with a ratio of 15.6, with house prices standing at £545,921 and average salaries £12,000 less than the average in London as a whole.
Haringey follows up in fourth with a ratio of 14.1.
Ironically, the City of London is the most affordable with a houses costing on average £763,748, just 5.3 per times average salaries of £144,000, followed by 8.3 per cent in Kensington and Chelsea, and 9.9 in Westminster, which has recently announced a crackdown on unaffordable luxury homes.
With average salaries over £100,000 higher in the City than in Hackney, it’s no wonder that homes are more affordable for residents looking to settle down in the upper crust of London’s well-buttered boroughs.
That said, there are only 9000 residents living in the City, and in well-heeled Kensington and Chelsea and neighbouring Westminster, the surplus of homes in the £5 to £10 million bracket are struggling to move off the shelf due to decreased demand in the uncertain climate surrounding Brexit and political turbulence as well as high stamp duty, further narrowing the ratio.
The official definition of affordable housing is that which is provided at above council housing mortgage rates but below market levels; welcoming rather widely set goalposts to say the least in boroughs where the average house price is just shy of £1 million.
Rental properties are more within the valley of the quantitative, with affordable homes renting at no more than 80 per cent of average local market rates.
For first time buyers looking at 10 per cent deposits of £94,000 on an average home in Camden, it might be helpful to adopt a more strict interpretation and enforcement of the term, but with London’s wealthiest postcodes being named the most affordable boroughs in the city it’s safe to assume that, in this report at least, ‘affordable’ is a relative term.