The lender’s latest local affordability analysis shows around 70 percent of local authorities across Great Britain have recorded an improvement in affordability over the past year. Islington in London saw the biggest gains, with its house price to earnings ratio falling from 10.6 to 7.8.
For landlords considering portfolio expansion, the data highlights stark regional disparities. A 10 percent deposit on a first-time buyer property sits between £10,000 and £25,000 in over half of local authorities – but London boroughs dominate the least affordable rankings.
Regional affordability divide widens
Kensington and Chelsea remains Britain’s least affordable area with a house price to earnings ratio of 13.9, meaning average prices exceed £1 million. Oxford and Cambridge follow at 8.0 and 7.3 respectively.
Andrew Harvey, senior economist at Nationwide, said the North has the smallest gap between least and most affordable areas within the region, while London shows the greatest variation by a considerable margin.
At the affordable end, Burnley and Hartlepool join Inverclyde among the most accessible areas for buyers, with house price to earnings ratios below 3.0. Scotland features heavily in the most affordable list, with Inverclyde, East Ayrshire and Aberdeen all requiring deposits under £12,000.
Deposit requirements vary tenfold across UK
The deposit challenge illustrates the scale of regional inequality. In Inverclyde, a 10 percent deposit averages £9,700. In Kensington and Chelsea, the same proportion requires £100,600 – more than ten times as much.
This follows Landlord Knowledge’s March report on spring market conditions, which found asking prices rising modestly despite geopolitical uncertainty. The latest figures suggest northern markets may offer more accessible entry points for both first-time buyers and landlords seeking yields.
All top ten local authorities requiring the highest deposits are in London, with 26 of 36 areas where 10 percent exceeds £40,000 located in the capital.
Propertymark calls for supply boost
Mary-Lou Press, president of NAEA Propertymark, said the data highlights a mixed picture for first-time buyers. “It is positive to see affordability improving in many areas, with around 70 percent of local authorities recording progress over the past year, which should help support market activity,” she said.
However, she warned that significant regional disparities remain. “High house prices in areas such as London and the South East continue to create substantial barriers, particularly when it comes to saving for a deposit,” Press added.
She called for housing supply increases and improved planning systems to maintain momentum. For landlords, the improving affordability picture could signal increased competition from first-time buyers in certain regional markets.
What this means for landlords
- If you’re considering portfolio expansion: Scotland and northern England offer the most accessible entry points, with deposits under £15,000 common in the most affordable areas.
- Watch for: Increased first-time buyer competition in improving markets – 70 percent of areas saw affordability gains, potentially reducing rental demand in some locations.
- Bottom line: Regional yield analysis becomes more important as affordability varies tenfold between cheapest and most expensive areas.
Editor’s view
The tenfold gap between Inverclyde’s £9,700 deposit and Kensington’s £100,600 tells the story of two housing markets operating under the same national policy. For landlords, the improving affordability in 70 percent of areas is double-edged – it signals healthier markets but also more competition from buyers who might otherwise rent.
Author: Editorial Team – UK landlord & buy-to-let news, policy, and finance
Published: 21 March 2026
Sources: Nationwide Building Society, Propertymark
Related reading: Asking prices rise 0.8% as spring market holds steady despite geopolitical uncertainty
