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Average cost of a London home now 14 times average salary

The cost of buying a home in London has skyrocketed since 2009 with the average home now costing 14 times the average salary in the capital, according to new figures.

Hometrack’s house price index shows that the average cost of a home in the city now stands at £482,800, a 9.1% increase in comparison to October 2015 and an 86% increase in comparison to 2009 following the financial crash.

Most worryingly for Londoners and workers across the UK, the gap between average salaries and average house prices continues to rise, with the figures in London now representing the highest level on record.

Cambridge and Oxford were the two other cities to experience double digit price to earnings ratio, almost double the UK average of 6.5x.

However, there are signs that London’s property market is cooling down in the wake of the EU referendum and other pressures on the market.

House price growth in the last three months slowed to just 1.3% and year-on-year growth is at its lowest level for three years as Hometrack warns that single digit growth looks likely over the next 6 to 12 months.

It also said that its Central London price index had already shown 0% growth in some of the capital’s most upmarket postcodes, as fiscal policy changes aimed at overseas buyers and investors weakens demand.