Norwich ranked as 15th least affordable city in the UK
Small businesses are not looking to finance to grow as much amid gloomy forecasts. Picture: Sonya Duncan - Credit: Sonya Duncan
Norwich has been ranked as the 15th least affordable city in the UK, according to a new study by Lloyds Bank.
The report found that home affordability in cities is at its worst levels since 2008, with properties costing nearly seven times people's earnings.
Average house prices in a UK city have surged by nearly a third over the past five years, with the average home costing £224,926 in 2017.
Over the same period, average annual earnings in a city have seen only a 7pc increase, rising to £32,796.
Lloyds ranked Norwich amongst the 20 least affordable cities in the UK, with an average house price-to-earnings ratio of 8.2.
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It was found to be more expensive than Chelmsford, York, Leicester and Exeter.
Oxford was named as the least affordable city in the UK, followed by London, Winchester and Cambridge.
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Stirling in Scotland was identified as the UK's most affordable city, with the average house price there put at 3.7 times local earnings.
The average home in a city now costs around 6.9 times the average annual wage - the least affordable house price-to-earnings ratio since 2008, when a city home typically cost 7.2 times annual wages.
London has seen the fastest house price growth over the last five years, with a 57pc increase taking average prices to £467,001.
Lloyds said the average house price-to-earnings ratio in London disguises considerable variations across the borough, with central London boroughs being significantly less affordable than Greater London as a whole.
Andy Mason, Lloyds Bank mortgage products director, said: 'City living is becoming increasingly expensive with average house prices at least 10 times average annual earnings in five of the UK's cities.
'Affordability levels have worsened for four consecutive years as average city house prices continue to rise more steeply than average wage growth.
'House prices in the South have generally seen stronger growth than in the North. St Albans has recorded the biggest gains over the past decade, whilst London has been the top performer during the recovery.'
Lloyds used house prices from its banking group's database as well as Office for National Statistics (ONS) average earnings figures for the research.
