Residential 

Mismatch between wages and house prices increases

Mismatch between wages and house prices increases

Airline pilots and flight engineers are among only five UK occupations to have seen housing affordability improve over the past five years.

Along with these high-flyers, electronics engineers, rubber process operatives, energy plant operatives, and merchandisers and window dressers all witnessed an increase in affordability - accounting for just 2 per cent of occupations.

The figures, compiled by mortgage broker Private Finance and based on information from the Office for National Statistics, highlight the growing mismatch between wage rises and house price increases.

While average earnings grew by just 9 per cent from 2011 to 2016, the average house price soared by 26.7 per cent, meaning the number of years’ earnings required to afford the average home increased from eight to 9.2.

Pilots and flight engineers have enjoyed the biggest five-year pay increase, meaning the average UK house price (£212,748 in 2016) amounted to 2.4 times their gross annual earnings of £89,317 - down from two-and-a-half times in 2011.

However, they are the only profession in the top 10 earners - a group that includes chief executives and legal professionals - to see their housing affordability improve since 2011.

Pilots are the only one of the top 10 highest-earning jobs to enjoy greater housing affordability now than in 2011

Occupation2011 2016 2011-2016 
 Median gross annual payHousing afford-ability ratio*Median gross annual payHousing afford-ability ratio*Pay rise (£)Pay rise (%)Change in housing afford-ability
Aircraft pilots and flight engineers£66,8102.5£89,3172.4£22,50734%-0.1
Chief executives and senior officials£71,5152.3£84,2752.5£12,76018%0.2
Air traffic controllersUnavailableN/A£83,1282.6N/AN/AN/A
Marketing and sales directors£64,5152.6£69,7323.1£5,2178%0.4
IT and telecommunications directors£57,9242.9£69,0263.1£11,10219%0.2
Legal professionals£56,0483£64,5223.3£8,47415%0.3
Medical practitioners£62,6212.7£63,4933.4£8721%0.7
Senior police officers£56,9033£62,4973.4£5,59410%0.5
Financial managers and directors£52,9593.2£56,9643.7£4,0058%0.6
Senior professionals of educational establishments£47,9523.5£52,4274.1£4,4759%0.6

Shaun Church, director at Private Finance, said: “The simultaneous squeeze on earnings and housing stock have piled pressure on many homebuyers, and there are few areas of the UK workforce that have seen their wages rise above the trend of property prices. 

“Barring a few exceptions, even the highest earning professions have not seen their annual pay keep up and aren’t immune to the limits this can place on movement in the housing market, particularly where larger purchases are involved. 

“This is especially true of those working in city hubs where house price rises have far exceeded the average 27 per cent over the last five years.

“Access to mortgage finance in a growing variety of shapes and forms is increasingly essential for many people to make headway at all levels of the property ladder. The changing nature of employment patterns also means the idea of a one-size-fits-all mortgage is becoming increasingly outdated for a large number of employees.

“The rise in self-employment, coupled with trends in pay and bonuses, often mean that the most suitable type of finance and the most appropriate lender can only be identified through a detailed assessment of personal circumstances and a knowledge of solutions that exist beyond the high street.”

Ishaan Malhi, chief executive and founder of online mortgage broker Trussle, said: “Soaring house prices continue to push home ownership out of reach for millions of people across the UK, but prices are only half of the story. 

“It can be hard for anyone with a busy job to take several hours out to speak to a mortgage broker on the phone, let alone sit down with them face to face. 

“This is where technological innovation is coming into its own. By giving people 24/7 access to free mortgage advice, online mortgage brokers are overcoming a lot of the accessibility challenges aspiring homeowners face when securing finance for their first home.

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