A new study has highlighted the growing gap between NHS salaries and house prices, revealing that many healthcare workers are being priced out of homeownership across large parts of the UK.
Research by mortgage broker Boon Brokers analysed NHS pay bands against average first-time buyer property prices in 15 major UK cities.
Using a 95% loan-to-value mortgage model and a 5.5-times income multiplier, the study found that many NHS workers cannot meet the borrowing requirements needed to buy an average first home in their local area.
The research identified Liverpool, Newcastle and Nottingham as the most affordable cities for NHS homebuyers, where workers on lower salary bands can still access entry-level properties. However, in many higher-cost cities, affordability only becomes realistic once staff progress to senior pay grades.
LEAST AFFORDABLE
London was found to be the least affordable market, with average first-time buyer homes deemed unaffordable even for NHS employees on Band 8a salaries. Bristol was the next most challenging market, where buyers typically need to reach Band 8a before being able to afford an average first-time buyer property.
Manchester, Edinburgh and Cardiff all require NHS workers to reach at least Band 7 before average first homes become affordable, while Birmingham, Southampton, Norwich and Leeds generally require a minimum Band 6 salary.
The study also revealed significant mortgage borrowing shortfalls. A Band 5 NHS worker in London faces a borrowing gap of £234,925 when compared with the average first-time buyer home. In Bristol, the shortfall stands at £122,780, while workers in Edinburgh and Manchester face gaps of £61,030 and £50,580 respectively.
GROWING DISCONNECT
Researchers found that affordability challenges extend beyond saving for a deposit. While many NHS workers may eventually accumulate a 5% deposit, they often still fail lenders’ affordability assessments due to insufficient income relative to property values.
The report concludes that homeownership is increasingly determined by geography rather than salary progression alone, with average first-time buyer homes becoming inaccessible to many NHS workers unless they move to lower-cost regions or progress significantly through NHS pay bands.
According to the analysis, in most UK cities NHS employees now need to reach at least Band 6 before purchasing a typical first-time buyer home becomes achievable, highlighting the growing disconnect between public sector earnings and property prices.
Read more HERE
