The affordability challenge is no longer confined to London

New research from Thriving Investments and PriceHubble reveals a widening national affordability challenge affecting essential workers and lower-to-middle income households across the UK.

Following on from an affordability study carried out in 2024, this latest piece of research identifies where affordability pressure is greatest and where investment can deliver both measurable impact and sustainable long-term returns.

• 550,000+ essential worker households need more affordable rental housing

• 1 in 3 essential workers spend more than 30% of income on rent

• 283 local authorities across the UK analysed

The geographic scale of unaffordability

The most significant shift in the data is the rapid rise of affordability pressure in regional cities for those on median incomes. Markets such as Manchester, Birmingham and Leeds are seeing rents grow faster than incomes, reflecting both economic expansion and limited housing supply. This is not marginal. Birmingham alone is estimated to have over 10,000 essential worker households requiring more affordable housing, with Leeds approaching 8,000 and Manchester nearly 6,000. At the same time, affordability pressure is clustering along high-productivity corridors - particularly the M4 and M40 - and across parts of the South West.

The UK’s affordability challenge is structural, national and persistent. The opportunity now is to align capital, policy and delivery - directing investment to the locations where it can generate both sustainable returns and measurable impact.

Cath Webster, CEO at Thriving Investments said:

“Affordable rental housing has an important role to play in supporting local economies. When essential workers can live closer to where they work, employers, communities and public services all benefit.

“The challenge now is to bring together investors, housing providers and the public sector to deliver more homes in the places they are needed most. Done well, this is an opportunity to align financial returns with lasting social impact.”

At Thriving Investments, through responsible place-based investment, we aim to build and nurture thriving communities up and down the country, while delivering strong risk-adjusted financial returns for our investors. Find out more about our investment approach.