Research from Lloyds TSB suggests that if you want to buy an affordable house you should look at properties in “New Towns”. The New Towns were built after the Second World War and include places such as Corby, Newtown in Powys, Harlow and Hemel Hempstead. In some of these one can find a combination of recent growth in average earnings coupled with sluggish house prices. This means that in some New Towns property could be more affordable than elsewhere. This could be of interest to buy-to-let investors as well as potential owner-occupiers.
The average price for a property in a New Town is £182,354 which is 6.1 times gross average earnings according to Lloyds TSB. This is below the national average of 6.9. As with any major financial decision it is essential to do your research carefully because each area is different and each property must be
judged on its merits. Another factor is the overall state of the property market both in terms of rental demand and capital values.
Some New Towns have seen rises in house prices in the last few years but in others there have been some serious falls. For example since autumn 2007 prices have fallen by 14% in Newtown in Powys but have risen by 14% in Hatfield.