STIRLING is the most affordable city in the UK to live in, according to a new report.
The Lloyds Bank study found that urban life has become less affordable over the last year amid surging house prices.
The latest figures show the cost of a home in a large town or city has jumped by 5 per cent in the past year, with the average price for a house having risen to £184,215 – nearly six times the typical wage packet.
But the average cost of a home in Scotland’s second-newest city is much lower at £132,734, just 3.3 times the amount earned by people living there.
The historic “gateway to the Highlands” won city status as part of the Queen’s Golden Jubilee celebrations in 2002 and is home to around 46,000 people.
The UK’s most expensive place to live is Oxford, where the average property price tag of £340,864 is 11 times the local salary and two-and-a-half times higher than in Stirling. This was followed by Winchester, which has a house-price-to-earnings ratio of 9.7.
Londonderry, in Northern Ireland, came second in the table of most affordable cities to live in, with house prices costing 3.6 times local earnings. Glasgow came in at ninth place, with houses there costing 4.51 times the typical wage packet.
Lloyds said average wages for city-dwellers have risen by 23 per cent over the last decade, while city house price rises have been lower at 22 per cent.
Marc Page, Lloyds Bank mortgages director, said: “Over the last five to ten years, affordability has marginally improved in most UK cities, as increases in earnings have kept up with house price rises in that time.
“However, the economic and lifestyle benefits often associated with residing in cities are continuing to drive demand, especially in the south of England. With city house prices continuing to rise, affordability deteriorated slightly last year, but the trend since 2009 is positive for the majority of UK cities.”
The most affordable cities are clustered in Scotland, Northern Ireland and northern England, with Belfast, Lisburn, Bradford, Lancaster and Salford all placed.
The top five list of least affordable places to live is completed by Truro, Bath and Brighton, while Westminster in central London came seventh.
Although property prices in Westminster are among the highest in the UK, relatively high earnings prevented the borough from coming higher on the list.
York was the only northern city to make the line-up of the UK’s least affordable cities, at number 20. A home in York costs nearly six times average wages, while one in nearby cities such as Hull and Sheffield would set buyers back less than five times their earnings.
A year ago, home buyers would have had to stretch themselves slightly less as city property prices typically cost 5.6 times wages compared to 5.8 today.
The report suggests the large numbers of people living in Oxford who commute to London to work has contributed to house prices being out of step with local wages.
The UK housing market has picked up sharply in some areas over the last year amid UK government schemes such as Help to Buy, which has unleashed a wave of fresh demand into the property market from people who had previously struggled to get access to a mortgage.
Lloyds used the house price database of sister bank Halifax for its research, plus earnings figures from the Office for National Statistics.
Halifax reported last week that UK-wide house prices had lifted by 7.9 per cent year-on-year in February, the strongest annual growth since 2007. But it also said prices are still around 10 per cent lower than peaks seen before the financial crisis.