If UK wages had grown at the same rate as in Germany in the past 12 years we would be at 2007 levels of affordability, research from fintech company Propertunity has found.
The median house price in the UK was £231,141 in 2018 according to the Land Registry, against a median UK wage of £35,998.
With German levels of growth wages would be at £41,932 in 2018, meaning house prices would be 5.5% times the median income – like it was in 2007.
Vadim Toader, founder and chief executive at Proportunity, said: “While house prices have ballooned since 2003, wages in the UK have failed to hit the same heights. This stagnation has resulted in a severe drop in home ownership, with the youth of today feeling the strain as they continue to struggle to get onto the property ladder.
“Recent housing policy has rightly focused on tackling the shortage of homes, but supply is only one side of the affordability crisis – a lost decade of wage growth has also meant homeownership is increasingly out of reach for most.”