Open Property Group recently looked into the continuous increase in house prices across England and analysed how the increase (or decrease) in annual salaries are influencing homeowner affordability.
Over the last year, every region in England experienced at least a 3% increase in house prices, except London which was the only region to experience a decrease in inflation.
In comparison, annual salaries increased 5.6% in the last 12 months across England. This presents the question: ‘Are house prices finally becoming more affordable for new and existing homeowners?’
Jason Harris-Cohen, Managing Director of Open Property Group, who will help England homeowners sell their property fast, said:
“House prices in England have seen a significant increase in recent years, driven by a combination of economic factors, supply shortages, and changing buyer demand. The rise has been particularly pronounced in cities such as London, Manchester, and Bristol, where demand continues to outstrip supply.
One key driver of rising house prices is the imbalance between supply and demand. New housing developments have not kept pace with population growth, leading to increased competition among buyers. This shortage is further exacerbated by planning restrictions and high land costs, which make large-scale construction projects more challenging.
Low interest rates over the past decade also contributed to the boom, making borrowing cheaper and encouraging more people to enter the housing market. Even though interest rates have risen recently, house prices remain high due to persistent demand and a lack of affordable alternatives.
Another factor is the appeal of property as an investment. Many domestic and international investors see English real estate as a safe asset, driving prices up further. Additionally, changing lifestyle preferences, particularly after the COVID-19 pandemic, have increased demand for larger homes with outdoor space, pushing prices higher in suburban and rural areas.”