Calls to drop Help to Buy

Wood, a former Bank of England economist, said the chancellor should use the budget later this month to cancel the programme, which has allowed first-time buyers with only small deposits to get mortgages previously restricted to existing homeowners.

The rise in prices came as the Bank of England's interest rate setting committee kept base rates at 0.5%. Rates have now been at this historic low for more than five years, with the Bank signalling that businesses and homeowners should not expect a rise until next year.

The Most And Least Affordable Cities In The UK

Oxford has been named the most expensive city in the UK as rising house prices make city living less affordable, according to a Lloyds Bank report.

The price of a home in a large town or city has grown by 5pc over the last year to reach £184,215 on average, or 5.8 times someone's average earnings, according to the research. A year ago, a homebuyer would have had to stretch themselves slightly less as city house prices typically cost 5.6 times wages at that time.

Stirling in Scotland and Londonderry in Northern Ireland were named as the UK's most affordable cities to live in, with house prices in those areas typically costing 3.3 times and 3.6 times local earnings respectively.

The UK's most affordable cities are clustered in Scotland, Northern Ireland and northern England, with Glasgow, Belfast, Lisburn, Bradford, Lancaster and Salford all featuring among the most affordable urban areas to live.

At the other end of the spectrum, Oxford was found to be the least affordable place to live, with people there facing a property price tag which is over 11 times the local wage, followed by Winchester, which has a house price-to-earnings ratio of 9.7.

Truro, Bath and Brighton made up the top five list of "least affordable" places to live, while Westminster in central London came in seventh place. Although property prices in Westminster are among the highest in the UK, relatively high earnings in the heart of London stopped Westminster from coming higher on the list.

York was the only northern city to make the line-up of the UK's least affordable cities, at number 20. A home in York costs nearly six times average wages, while one in nearby cities like Hull and Sheffield would set someone back just over four and-a-half times their earnings.

The average house price in Oxford is £340,864 – which is around two-and-a-half times the price of a typical home in Stirling at £132,734.

The report pointed to the large numbers of people living in Oxford who commute to London to work as part of the reason why house prices there are particularly out of step with local wages. A year ago, a house in Oxford cost 9.8 times local earnings.

UK's most affordable cities


House price-to-earnings ratio

Stirling, Scotland


Londonderry, Northern Ireland


Newry, Northern Ireland


Belfast, Northern Ireland


Bradford, Yorkshire and the Humber


Lancaster, North West


Lisburn, Northern Ireland


Salford, North West


Glasgow, Scotland


Durham, North


UK's least affordable cities


House price-to-earnings ratio

Oxford, South East


Winchester, South East


Truro, South West


Bath, South West


Brighton And Hove, South East


Chichester, South East


Westminster, Greater London


Salisbury, South West


Cambridge, East Anglia


Southampton, South East