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Average Kent property now costs ten times the average salary

By KentOnline reporter

The average Kent property now costs just shy of £300,000, more than ten times the county's average wage.

The 12.38% increase from £265,092 in the first quarter of last year takes the average price to £297,781, and the upward trend is expected to continue - even with Brexit fast becoming a reality.

Fifteen of the last 16 quarters have shown an increase in prices, but the averages mask a complex picture says Edward Church, head of agency at Strutt & Parker LLP in Kent.

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Swanley and Bexley have been identified as property hot spots. Stock image
Swanley and Bexley have been identified as property hot spots. Stock image

"Some properties have really skyrocketed, particularly some of the coastal properties.

"They've been enormously popular in the last year, some have definitely gone up 25% or sometimes more."

"People are being priced out of other areas, so they are looking for value, but they are also looking for proximity to London, space, and a nice environment"

"It's the higher value properties that have struggled, and haven't increased by such a large proportion as those on the mass market."

The main beneficiary of the demand for coastal property has been the traditionally low-cost Thanet district, which has seen some of the steepest price rises in the country.

Mr Church said: "It starts from a low base people, but also people are being priced out of other areas, so they are looking for value, but they are also looking for proximity to London, space, and a nice environment.

"The beaches and the coasts in Thanet are very sought-after."

Even with the price increases, the district still has the cheapest houses in Kent, at an average cost of £218,030.

But with wages in Thanet averaging £20,882 per year, this is still more than ten times the average annual wage.

So in terms of affordability, for local people at least, this puts Thanet in line with wealthy Sevenoaks.

The Sevenoaks district boasts the county's highest average wage at £46,930, but also has Kent's priciest homes - the average property costs £501,368.

Like Thanet, this is more than ten times more than the average person earns in a year.

Anyone looking for a better ratio between wages and house prices should try the Medway towns, where the average cost of a home is £221,085 - seven times the average wage of £27,648.

Average property prices compared to average wages

The lack of affordability could be affecting house sales.

According to Kent County Council's latest figures, property transactions in the first quarter of 2016 are down almost 20% compared to the same period last year, the lowest quarterly sales figures since 2013.

Mr Church said it's a trend he expects to continue, at least in the short term, in part due to Brexit, which could have huge implications for the housing market.

He said: "It does't necessarily indicate such a steep fall over a longer period of time, so it'll be interesting to see if it is mirrored in the second quarter.

"I think it might be, in fact I think transaction levels might be quite low in the second quarter as we move towards the Brexit vote.

"We've seen a relatively sharp decline in all respects in the housing market."

However, even with the threat of Brexit-induced recession looming, Mr Church says the picture for the property market is not all doom and gloom - especially if you're an overseas buyer.

He said: "Most people should be confident because they are going in a direction they have chosen.

"There was a strong leave vote in Kent - it's what the majority asked for - so I think they'll respond enthusiastically.

"And a fall in the stock market can mean property seems like a good place to keep your money.

"Gold has increased in value quite significantly, which isn't a surprise, but people also like property as a safe haven."

Foreign buyers are attracted in part by Kent's top performing independent schools
Foreign buyers are attracted in part by Kent's top performing independent schools

Foreign investors may also take advantage of the weak pound to buy up property in London and Kent, said Mr Church.

"It might be that the change in the value of the pound against the dollar and the euro encourages some buyers from overseas to move back into London, where the market was struggling, so that might drive people out into the country.

"And there's good interest in Kent from foreign buyers, who come for the schooling combined with access to London and Europe."

Kent has always been a county of two halves when it comes to house prices, but as more people move to the county, the difference between the east and west may narrow.

And although both house prices and wages are higher in Kent than the national average, the county still plays second fiddle to the rest of the south east.

This too though will change, says Mr Church.

"Prices will continue to grow. Kent has traditionally been the least fashionable of the home counties, but those old habits will die; slowly, but they will change.

"Kent is becoming increasingly fashionable in my view."

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