Halifax



Halifax

December 10, 2012 08:10 ET

London: The Spending Capital

The most expensive place to live in the UK, but Londoners still have the most to spend

LEEDS, UNITED KINGDOM--(Marketwire - Dec. 10, 2012) - Despite the fact that London has the most expensive homes in the UK and the house price to average earning ratio is third highest, Londoners still have more spending money than anyone else in the UK, according to The London Factor research, published today by Halifax.

Outlining the advantages and disadvantages of living in the capital city, The London Factor data puts forward considerations such as the fact that the average house costs 70% more in London, that Londoners live longer, and they have more disposable income than any other region in the UK, with over £20,000 per head to spend every year.

Martin Ellis, Halifax Economist, said:

"There are numerous advantages and disadvantages to living in London, and each one of these factors will have different relevance to different people – for example, those who have grown up children may not be as concerned about the local education system.

"The data shows that London has the most expensive homes in the UK and that property is unaffordable for many living in the capital. However the UK's top five earning areas are all in London, and Londoners have a higher disposable income than those living in the rest of the country."

Key London Factors

Housing

- At 70% above the UK average, London has the most expensive homes in the country.

- Since 2007, the average house price in the capital has fallen by 15%, holding their value better than the UK average (a 20% drop).

- The house price to average earnings ratio, at 4.7 times the average wage, is the third highest in the UK, behind the South West (5.1) and the South East (4.8).

- At £11,843 per year, London is the most expensive place to own and run a house (UK average £9,393).

- London homeowners typically pay 14% (£177) a month less than the average London renter, which makes London the most affordable area to buy versus rent in relative terms although actual rental costs in the capital are the highest in the UK.

- Around half (49.9%) of London's homes are occupied by their owner; the lowest owner occupation rate in the UK.

Cost of housing

- Since January 2011 housing costs in London have risen by 1.9%; that's 1.7% lower than inflation (3.6%) over the same period.

- Since January 2008 housing costs in London have fallen by 2.4% (the only other region they fell was in the South East, at 0.4%). This improvement was largely driven by the fall in mortgage payments.

Savings

- Londoners still manage to save – and have an average balance of £8,161 – higher than the average for England and Wales of £7,830.

- The lowest levels of savings relative to earnings are in London for both women (30%) and men (16%).

Economy

- Londoners in full time work earn over £1,100 per month more than the UK average (£3,857 p/m v £2,736 p/m).

- Labour productivity in London (2010) is a third above the UK average.

- Gross disposable household income (GDHI) per head of London residents is the highest of all regions. At £20,200 in 2010, it was 29 per cent higher than the UK average.

Employment

- At 68.1%, the employment rate in London is 2% lower than the UK average (70.2%).

- The UK's top five highest earning areas are all in London.

- When it comes to the percentage of people in employment, there isn't a single London area in the UK's top 100, with an employment rate of 75.8% Richmond Upon Thames is the highest ranked London area at 102nd.

- At 9.3% the, unemployment rate in London (as based on claimant count) is over 1% higher than the UK average of 8.2%.

- Richmond upon Thames (4%) has the lowest unemployment rate in the capital.

Quality of life

- Richmond upon Thames, Kingston upon Thames, Kensington and Chelsea, and Bromley are the London areas in the top 50 best places to live in the UK.

Crime rate

- The average number of burglaries per 1,000 homes in England and Wales is 47. In London, the average is 76; however, in Inner city London the average is 37 per 1,000.

- Three of the worst five areas for burglaries in England and Wales are in London: Haringey is the worst with 114 burglaries for every 1,000 homes, Waltham Forrest third (112 per 1,000) and Hammersmith and Fulham fourth (111 per 1,000). Leeds (2nd: 113 per 1,000) and Cheltenham (5th: 110 per 1,000) complete the top five.

Environment

- London produced 5.5 tonnes of carbon dioxide (CO2) emissions per resident in 2009, the lowest of all the English regions.

- The traffic on major roads in London decreased by 8.7% between 2001 and 2011, this was the only decrease for the English regions and countries of the UK.

Population

- London includes the most densely populated parts of the country with an average population density in mid-2010 at 4,978 people per square kilometer (sq km), the highest of all the English regions and countries of UK.

- London is the smallest English region in terms of area, at 1,600 sq km, occupying less than 1% of the total area of the UK.

- London had a population of 7.8 million in mid-2010, an increase of 6.9% since 2001, compared with an increase of 5.3% for the UK over the same period.

- London's age profile is younger than that of the UK as a whole, with a higher proportion of people aged under-16 (19.6%, compared with 18.6% for the UK in 2010). People aged 65 and over made up 11.5% of the population, compared with the UK average of 16.6%.

Education

- In London, 61.9 per cent of pupils achieved five or more grades A*–C at GCSE level or equivalent including English and mathematics in 2010/11, compared with 58.4 per cent for England as a whole.

Life expectancy

- Life expectancy at birth in London in the three-year period 2008 to 2010 was 79.0 years for males and 83.3 years for females, above the England average (78.2 and 82.3 years respectively).

Editor's Notes

Data Sources:

Housing: Halifax House Price Index and ONS Q3 2012
Cost of Owning a Home: Halifax House Price Index and ONS January 2008‐January 2009
Economy: ONS August 2012
Employment: NOMIS and ONS July 2011‐June 2012
Savings: Halifax Savings database September 2012
Quality of life: Halifax December 2011
Education: Department of Education January 2012
Life expectancy: ONS October 2011
Environment: Department of Energy and Climate Change August 2012
Crime rate: Crime Survey for England and Wales – ONS 2012
Population: ONS 2011

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