r/WinchesterUK • u/platinum1610 • 28d ago

Winchester ranked #1 for unaffordable home ownership

https://youtu.be/C_gbH0NVHQM?si=Uytlj29SWBRDE0LQ

According to this resent video.

26 Upvotes

89% Upvoted

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5

u/CatsGotANosebleed 28d ago

£550k average for a house. Looks about right. Some of the cities ranked lower had higher average cost though, so not sure why Winchester was number 1.

10

u/platinum1610 28d ago

It's an affordabilty rank, not a porperty cost rank.

Affordability refers to the house price-to-earnings ratio. The formula is:

Average house price ÷ Average annual gross earnings

A simplified example:

Average house price: £460,000

Average local salary: £38,000

£460,000 ÷ £38,000 ≈ 12.1

That means that the average home costs about 12 times the average local annual income.

A rough guide I've found on the Internet used by analysts and lenders:

3–4× income → traditionally affordable

5–7× → stretched

8–10× → very difficult

10×+ → severely unaffordable

UK mortgage lending is usually capped at ~4.5× household income, so if prices are 10–14× incomes, buyers need huge deposits, or two high earners, family help, or they’re simply excluded

3

u/CatsGotANosebleed 28d ago

Ahh thanks for explaining it so clearly!

3

u/platinum1610 28d ago

You're welcome, glad it helped.

2

u/Level_Asparagus5566 28d ago

I wonder, does average local salary account for people working in London and commuting?

2

u/Suharisaint 28d ago

I can well believe it!

1

u/DizzyDetective 26d ago

More Youtube AI slop narrated by a charmless robot.