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Homes in some London neighbourhoods are more affordable than at any time this decade, research shows today.
Analysis of government data indicates that the average price of a home compared with the average salary in some boroughs has returned to 2000 levels. Experts are describing the next year as the "golden moment" to buy.
In Bromley, the average property cost 8.06 times the average salary in the borough last month, while in Havering the figure dropped to 6.68 - both where they were at the turn of the century. The research by propertyfinder.com appears to show that, taking London as a whole, the average-priced home is within the same financial reach it was in 2005.
Wages have continued to rise in recent months even though house prices have plummeted by around 20 per cent in the capital over the past year, closing the affordability gap.
But this measure takes no account of how tough it has become to secure a mortgage in the past year. Lenders are demanding far larger deposits and stringent credit checks, which is locking out many first-time buyers. Buyers who offer less than 10 per cent of a home's value up front struggle to find a loan - although options are slowly appearing.
Across London the house price-income ratio varies. In the traditional City banker enclaves of Kensington and Chelsea and Hammersmith and Fulham, the affordability measure has fallen to where it was in 2006.
The price-income ratios in those boroughs are still prohibitively high for most - at 21.22 and 11.04 - while it was also hard to afford a home in Westminster (12.15), Camden (11.02) and Richmond (10.64).
The areas with the lowest ratios were Tower Hamlets, Barking and Dagenham, and Bexley - where the average-priced home was just over six times the average salary of residents.
Nicholas Leeming, director of propertyfinder.com, said: "Extraordinary opportunities are emerging in some parts of the capital to buy homes cheaper than at any time in almost 10 years.
"With homes in London barely outstripping inflation since 2003, people will look back to 2009/10 as a golden moment to get on the property ladder or trade up to a larger home."
He said prices may still drop but the property market was picking itself up after "a very protracted and steep decline".
Reader views (13)
It's simple the best time to buy a house is when the market reaches bottom, when does the market reach bottom, I am afraid you will need a crystal ball for that one, you haven't got one ! don't worry neither has anybody else but for my money the housing market has yet to bottom, could be another year or two, it is certainly not going to suddenly rise.
- Royston Amphlett, Bournemouth England, 04/06/2009 00:38
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"Wages have continued to rise in recent months" no they haven't. another story on this site today says "Pay rises at a record low". who researches this rubbish?
and the "affordable" boroughs mentioned are fine as long as you don't want to buy english groceries locally and are happy to send your child to a school where 90% speak english as a second language. the only reason the prices are lower is because people that can afford to buy don't want to live there anymore 
and how is "Lenders are demanding far larger deposits and stringent credit checks" a problem? stupid lending (mostly in US) was what got us all into this mess. how can it be bad to make sure that people can actually afford to pay back what they are borrowing?
- Barry, woking, surrey, UK, 03/06/2009 23:37
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Yet another in a string of recent newspaper articles that can best be summarised thus: "Estate Agents say now is a really good time for you to buy a house". Why don't journos ever try to get the views of real experts, i.e. those who don't work for the property industry and would draw attention to wider economic reasons why now is NOT a good time for you to buy a house.
- George, London UK, 03/06/2009 15:37
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There's no such thing as value for money if you live in London.
Apart from the legions of you on benefits that is.
- Steve, London, 03/06/2009 14:13
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If houses are such great value now compares to next year (which I contend is not true), surely Mr Leeming should be keeping quiet and investing in this market for his own account. Can we know how much of his personal funds he has actively invested in the London property market in the last six months ?
- Frank, London, 03/06/2009 13:58
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"Wages have continued to rise in recent months"
Where did this gem come from? Maybe for tube drivers this is true!
- C Harrison, London, 03/06/2009 13:15
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They are still way over priced and still have a long way to reach reality.
- Dirk Diggler, Soho, London, 03/06/2009 13:05
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How can the director of propertyfinder.com be described as an expert? Surely he should be described as someone with a vested interest in people buying houses.
If you love prices now, wait another 12 months and you'll love them even more!
- Investment Banker, London, 03/06/2009 12:57
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Hey! Prices have gone from ridiculous to astronomical.....8 times incomes in Bromley, what a bargain. With 20% deposits being the norm I can't imagine a rush.
- Mark, London, 03/06/2009 12:01
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They may be the best value for a decade, but definitely not on a longer view. Until someone on an average wage can buy an average house for no more than three times his salary, they remain overpriced. That doesn't mean it's automatically a bad idea to buy one to live in, but don't think of it as an investment!
- Nigel, London, 03/06/2009 10:52
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Given the expenses scandal, it is easy now to see why our politicians couldn't care less about the vast housing shortage their policies have created. Many of them have been making a fortune out of their second homes.
- Nigel, London, 03/06/2009 10:30
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6 times your salary isn't brilliant. It's still daylight robbery for anyone who's on an income of less than £40k, which, lets be honest, is alot of Londoners.
- S-M Hearmon, London, UK, 03/06/2009 09:49
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Using 2000 is not a valid benchmark, given that this housing boom had its root circa 1993, 7 years earlier.
- Dave Davies, Basingstoke, 03/06/2009 09:19
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