HOME affordability for people living in Scotland's cities has improved by nearly one-quarter since 2008, according to a housing report.
The typical price for a city home is now £159,450, equating to 5.15 times gross annual average earnings, which is 22% below the peak of 6.57 recorded five years ago. The figure also means city properties north of the Border are more affordable than the UK city average, the Bank of Scotland Affordable Cities Review found.
House price drops across the country's cities in recent years have driven the improvement in affordability, the study said.
Since 2008, the average city house price has fallen by 15% from £187,377 to £159,450 in 2013.
Stirling was named the most affordable city in Scotland – and the fourth in the UK – with an average property price that is 3.81 times yearly earnings in the area.
The next most affordable Scottish city is Glasgow (4.23), which is also the seventh-most affordable UK city, while Inverness was found to be the least affordable city, with a ratio of 5.71.
Nitesh Patel, housing economist at the bank, said: "There has been a significant improvement in housing affordability in many of Scotland's major urban areas over the past five years, largely reflecting the general decline in house prices since 2008.
"The average price for a city home in Scotland is significantly below the peak of 2008 and is more affordable than the UK city average.
"Looking forward, the marked improvement in city affordability is likely to help support demand for those able to raise the necessary funds to enter the housing market."
Dundee is named as the third most affordable city in Scotland with a price to earnings ratio of 4.67, followed by Aberdeen, where the average house price of £180,017 is just over five times gross average earnings.
Edinburgh is next on the list, followed by Perth and then Inverness as the least affordable.
At £172,556 on average, the price of a home in a UK city now costs around 5.60 times typical gross annual earnings, up from 5.55 times typical incomes in 2012.
The survey put the recent slide in affordability down to city house prices starting to creep back up again during 2012 following a general decline seen since 2008. House prices in urban areas have increased by 1.7% over the last year.
With its close commuter links to London and its stunning architecture, Oxford, the city of dreaming spires, was named as the UK's least affordable city, where house prices are almost 10 times earnings.
Meanwhile, Londonderry in Northern Ireland, where house prices have fallen sharply since the economic downturn, was the most affordable city, with homes costing less than three-and-a-half times the yearly local wage.
The 10 least affordable cities to buy a home in were all in the south of England, where house prices tend to have held up more strongly, including Salisbury, Bath, Brighton and Exeter.
The survey used a mixture of official figures and those from Halifax's house price database for its research.
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