According to a recent study conducted by the Centre for Economics and Business Research, the average UK house earned more in 2014 than the average worker in the UK.
The study showed that the average UK house prices increased by 12 per cent – equivalent to £29,339, while the average worker took home earnings of £27,271.
More than 60 per cent of the working population earned less than the average home in the last 12 months. In theory, that means your home may earn more than you!
This means a typical home’s earnings now outperform the country’s most-relied upon professions and massively exceed the starting salaries of a junior hospital doctor (£22,636), a graduate nurse (£21,388), a teacher (£22,023), a police officer (£23,317) and a solider (£17,945).
John Willcock, head of mortgages at Post Office, said;
Property prices have soared over the last year, following a long period of recovery and are set to increase further over the next five years. Whilst this is good news for those that already own their home, our study highlights the struggle that buyers and movers looking to climb the property ladder face, especially in getting on that all-important first rung. Homeowners in the East, South East and London saw their earnings outclass the most with properties in each region earning £34,002, £35,188, and £80,462 respectively. Houses in the nation’s capital earned £80,462 – almost twice as much as the average London salary (£41,095). They earn more than the average earnings of a fully qualified doctor in the UK (£70,648).
John Willcock also says;
The group forecasts a slight contraction of 0.8 per cent in 2015, as the market responds to the Mortgage Market Review (MMR) guidance. The MMR is likely to bring in longer transaction times and more rigorous criteria, meaning the overall process of buying and moving takes longer. As one of the top ten providers of mortgages in the UK, we understand that owning a home remains an aspiration for many people, and that they need all of the help they can get.
Danny Luke, Business Manager at Quick Move Now said;
It’s no big surprise that house prices have risen faster than wages in recent years, however it’s astonishing just how fast this gap has grown. It will be interesting to see how this affects the property market in 2015. Even with the introduction of the governments new discount scheme for first time buyer, this trend will make it even harder for people to get their feet onto the property ladder.