Britain’s middle class squeezed by soaring property prices

Members of the professional middle class in England and Wales have seen a rapid decline in their options when looking for a place to buy a house. The number of electoral wards where the average property price is above the affordability threshold has risen from just 101 (1.1 per cent) in 1995 to 489 (5.7 per cent) in 2012.

Government and industry guidelines suggest a threshold of 35 per cent of net household income as the point above which housing becomes unaffordable. In 2012 the average household in the 95th percentile of UK earners brought in £67,340 net, giving a ceiling of £23,569 to spend on housing costs.

Nineteen years ago, eight out of 10 wards that were unaffordable even for this income group were in London. Two-thirds of those were in just three boroughs, Kensington and Chelsea, Westminster and the City of London. By 2012, mortgage payments on the average property in more than a quarter of wards in London had risen above the threshold and there were unaffordable areas in every English region.

Notes on data: Figures shown in the map are for households in the 95th percentile by net income, with proportions calculated using local price paid data, and typical regional mortgage advances and interest rates. The affordability level is fixed at 35 per cent of net income, as per official guidelines.

Sources: Savills, Institute for Fiscal Studies. Map data: OpenStreetMap contributors via MapBox