St Albans homeowners earn more from property than work

Many St Albans and Harpenden homeowners are earning more from their property than their job, new research has revealed.

St Albans came third on a list of 119 Local Authority Districts (LADs) where average house prices outpaced owners’ earnings.

According to research by Halifax, average property prices have increased by more than the total average employees’ net earnings in a third (31 per cent) of UK LADs in the past two years.

Haringey in London recorded the largest gap between rising property values and earnings, with an increase of £139,803 over the past two years – a difference of £91,450 compared to average take-home earnings of £48,353 during the same period.

This was followed by Harrow in north London, where prices have increased by £128,841, a difference of £77,791 compared to average earnings of £51,050.

Then came St Albans LAD, which includes Harpenden. House prices have risen by a whopping £131,645 in the area over the past two years, leaving a gap of £72,995 when compared with net median earnings of £58,651.

The rest of the top 10 were all in London, East of England or the South East, with Watford coming in sixth followed by Three Rivers – including Rickmansworth and Abbots Langley - in ninth.

UK-wide, 17 per cent of all UK local areas have seen average house prices shoot up above the rate of average pay.

Martin Ellis, housing economist at Halifax, said: “Buoyancy in the housing market over the past two to five years has resulted in homes increasing in value by more than total take-home earnings for the average homeowner in many areas, though mostly in southern England.

“While it’s no longer unusual for houses to ‘earn’ more than the people living in them in some places, there are clearly local impacts.

“Homeowners in these areas can build up large levels of equity quickly, but for potential buyers whose wages have failed to keep pace, the cost of buying a home has become more unaffordable during that time.”