More than half of two and three-bed homes now affordable for average earners: Zoopla

51% of two and three-bed houses for sale in Britain are listed at a price a household on an average income can afford, up from 45% in 2025, new Zoopla analysis shows. 

A household on an average combined income of £53,500 can now afford a home listed at up to £301,000. This assumes a mortgage of 4.5 times their gross annual income and a 20% deposit. 

However, while affordability is improving and buyers have more choice, more would-be movers remain cautious about moving. Average mortgage rates now exceed 5%, having started the year at just 4%, and sales agreed are 9% lower than a year ago as uncertainty weighs on buyer confidence.

Improvements in affordability seen in the south

The biggest improvements over the last 12 months have been in southern and eastern regions where income growth, more homes listed for sale, and flat to falling house prices have brought more properties within reach of buyers. The South West has recorded the greatest improvement for buyers, with the proportion of houses that are affordable rising by 10 percentage points to 47%, followed by the East of England (nine percentage points). 

Northern regions have seen smaller increases, largely because a greater proportion of houses were already more affordable.

Despite these improvements, affordability is still a constraint on buyers in some southern regions. In the South East, just 23% of two and three-bed houses fall under the affordability threshold, where the average asking price stands at £375,000. London remains the least affordable market by a considerable margin, with fewer than 100 two and three-bed houses priced below £301,000.

The North East remains the most affordable region, with 83% of two and three-bed houses for sale priced below the £301,000 affordability threshold, at an average of £155,000. Scotland (80%) and Yorkshire and the Humber (76% also offer buyers a much wider choice of houses that are affordable.

Affordability hotspots where buyers have the greatest choice

At a more local level, there are hotspots in each region where buyers have a much wider choice of affordable two and three-bed houses. Across the 50 towns identified, the average asking price for a two or three-bed house is around £189,000, more than £100,000 below the national average of £293,200.

In Scotland, every two and three-bed house currently listed for sale in Keith, Alloa, Kilwinning and Arbroath falls below the £301,000 affordability threshold. Bootle in the North West (98%), Treorchy and Newtown in Wales (both 97%) and Immingham in Yorkshire and the Humber (95%) also rank among the country's most affordable locations.

Despite its reputation for high property prices, there are also pockets of affordability in southern England. In the South East, East Cowes on the Isle of Wight leads the way, with 77% of two and three-bed houses priced below the threshold, while Leiston in Suffolk (87%) and Par in Cornwall (83%) top the rankings in the East of England and South West respectively.

Many of these hotspots are established communities close to major employment centres, including Bootle near Liverpool, Hebburn and Blaydon-on-Tyne near Newcastle and several towns across the West Midlands' Black Country.

Coastal towns also feature prominently, from Whitehaven and Workington in Cumbria to Lowestoft in Suffolk and Ilfracombe in Devon. Meanwhile, four of Wales's five hotspots are in the South Wales Valleys, including Treorchy, Pentre and Mountain Ash.

Richard Donnell, executive director at Zoopla, commented: “The number of two and three-bedroom houses within reach of households on an average income has increased as incomes continue to rise faster than house prices. However, the impact is being offset by higher mortgage rates which are adding to the monthly costs of taking out a new mortgage. 

“The extra cost for buyers is greater in southern regions where house prices are higher and this affordability divide is seen across the country. More than two thirds of houses in northern England and Scotland are now affordable to the average household while this drops to less than a fifth in London and South East England.

“We expect house prices to continue to rise more slowly than incomes which will continue to help improve the affordability of housing. A greater choice of homes for sale is supporting a buyers market and means that sellers are having to be more realistic on price. Anyone considering a move should take a fresh look at what they can afford and what's available locally. Waiting for mortgage rates to fall further may not necessarily put them in a better position to buy.”