Affordability isn’t just about house prices; council tax, home insurance and energy bills will also hit your wallet.
By these measures, the most affordable place to live in the UK is Derby, while the priciest is Birkenhead in Merseyside, according to research from Compare the Market.
The comparison site looked at household bills in 80 of the UK’s most populated towns and cities.
Here, we explore the findings in more depth and explain why they don’t tell the whole story.
UK’s cheapest cities and towns to live in
The 10 cheapest areas, listed in the table below, contain some surprises.
For example, London may be famed for its high house prices, but according to Compare the Market’s research, it’s actually the eighth-cheapest city in terms of household bills.
| City/town | Average council tax | Average home insurance | Average energy bills | Total average cost |
| Derby | £1,591.68 | £142.71 | £1,134.42 | £2,868.81 |
| Edinburgh | £1,705.42 | £169.96 | £1,061.59 | £2,936.97 |
| Southampton | £1,724.11 | £151.78 | £1,080.80 | £2,956.69 |
| Swansea | £1,792.92 | £146.26 | £1,094.80 | £3,033.98 |
| Newcastle upon Tyne | £1,844.82 | £138.24 | £1,086.57 | £3,069.63 |
| Newport | £1,834.09 | £159.77 | £1,096.23 | £3,090.09 |
| Aberdeen | £1,768.07 | £145.33 | £1,202.21 | £3,115.61 |
| London | £1,790.83 | £206.47 | £1,130.35 | £3,127.65 |
| Stoke on Trent | £1,930.81 | £129.15 | £1,107.55 | £3,167.51 |
| Wigan | £1,891.37 | £149.90 | £1,129.14 | £3,170.41 |
While it may not be one of the 10 overall cheapest areas to live in, Exeter came up trumps for energy bills, with residents paying just £987.90 per year on average.
Those living in Norwich, meanwhile, have the lowest home insurance costs at £122.11 per year.
Cheapest area to live in London
The cheapest London borough to live in – with the heavy caveat that this is just based on household costs, not house prices or rent – is Westminster. The average bills in the political heart of London come in at £2,036.54 a year, according to Compare the Market.
The priciest London borough is the suburban area of Harrow, where council tax and bills average £3,763.87 a year.
However, the differences in household bills could partly be down to property sizes, with people being more likely to live in a house in Harrow and a flat in Westminster.
House prices matter
When you look at housing costs, the story changes. The average home in Westminster cost £966,268 in October, more than double Harrow’s average of £458,003, according to Land Registry data.
Turn those prices into monthly mortgage repayments and the difference becomes obvious.
Using the lowest two-year fixed mortgage rate we could find at the time of writing (1.24% for a 75% LVR mortgage), a mortgage in Westminster would start at £2,810 a month.
In Harrow, your mortgage would cost £1,332 a month.
While cutting your household bills matter, so does your mortgage: find out more about remortgaging here.
Heat map: average living costs by borough
Hover over the boroughs to see the average total cost of council tax, home insurance and energy bills in each area of London.
Find out more: how to buy a house or flat in London
How to choose where to live
Of course, in reality, home insurance costs and council tax will only a small factor in your decision on where to live.
You’ll probably have a pretty clear idea of where you’d like to buy a house long before you start searching for a property, but if you’re tossing up between two or more areas it’s worth considering the following:
Find out more: finding the best places to live
