London homes have earned £117,000 more than the people who live in them over the past five years, figures show.
The research by Halifax reveals average house prices in the north-west London borough of Barnet increased by £247,000 whereas average earnings added up to £130,000 over five years, meaning Barnet homes earned almost twice as much as their owners.
“Barnet has a very good education record, which is a bit of a magnet for families,” north London estate agent Jeremy Leaf told Homes & Property. “What that tends to mean is that it attracts young professionals but because it is a little bit better value for money than inner London areas and is greener, it also attracts older people who want to be near their grandchildren.”
Although the difference was greatest in Barnet, the research found that a fifth of local areas in the UK saw average house prices increase by more than total average pay, with nine of the top 10 areas in London.
Hertsmere in Hertfordshire, one of the Home Counties, was the only area outside London in the top 10 areas where house price growth exceeded wages – by £71,000.
Average house prices surpassed take-home pay by more than £100,000 in the past five years in three areas: Barnet, Merton in south-west London, and Waltham Forest in north-east London.
There were only two boroughs where high earners made more money than their properties over five years.
In Hammersmith and Fulham, the average salary added up to £145,000 over five years, £67,000 more than house prices rose in the same period.
In Westminster, where five-year salaries were the highest in London at £157,000, homes earned £53,000 less than their owners.