OXFORD has been knocked off the top of the table as the least affordable city in the UK.

According to Halifax, Winchester has taken the number one spot, with homes now 14 times annual earnings for those living and working there.

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Oxford is ranked second, with people now needing to earn an average salary of £39,220 to live in the city, meaning housing affordability has slightly improved from last year.

London was outside the top five least affordable cities for the first time in six years.

A 10.3 per cent surge in city house prices over the past year now sees the average property costing 8.1 times average earnings, Halifax found.

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Here's a chart showing the top 10 least affordable UK cities in 2021 with the average house price and average annual earnings:

While the average city house price increased to £287,440, average earnings in these locations increased by only 2.1 per cent annually, to £35,677.

William Kirkland, who runs the Oxford branch of Knight Frank estate agents, said despite the increased house prices, Oxford is still an attractive place to live with an increase of people moving out of London to the city.

He said: "We’ve seen the work from home situation provide a boost to the Oxford market because a lot of people have left the capital thinking that Oxford is a very good alternative.

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"You’ve got very attractive countryside on the doorstep, fantastic schools, shopping – there’s a lot to offer. Its popularity may have increased in the last 12 months.

“The market here has always been very strong. Our London buyers are up 60 per cent year on year and I think that is testament to the number of people now considering leaving London because perhaps their work situation has changed.

However, the estate agent believes there is a shortage of affordable homes for people who live in the city to buy.

He added: "Oxford has always suffered from a lack of stock. Available property at any one time is pretty limited.

“The city does suffer from the lack of affordable housing, there’s no question about that.”

The affordability of city living has worsened. In 2020, house prices in cities typically had cost around seven and-a-half times wages.

After sitting at 5.6 from 2011 to 2013, the house price-to-earnings ratio in UK cities has increased for eight years in a row.

ALSO READ: Oxford tops list of least affordable locations for first-time buyers

However, cities still tend to be marginally more affordable than the UK as a whole, which has a house price-to-earnings ratio of 8.5.

Wages in cities are often higher than in rural areas, and during the coronavirus pandemic many city dwellers have relocated to the countryside, helping to push up house prices there.

Londonderry held its position as the UK’s most affordable city for the third year in a row, with a price-to-earnings ratio of 4.7.

Russell Galley, managing director of Halifax, said: “Affordability is significantly better in the north and there are now just two cities – Plymouth and Portsmouth – with better than average affordability in the south.”

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