Which cities have delivered residents thousands more in disposable income than the rest of the UK?
Living standards in 11 UK cities and large towns have grown more than twice as fast as the national average over the past decade – but continued progress depends on tackling housing and planning constraints, according to new analysis from Centre for Cities.
The think tank’s Cities Outlook 2026 report shows that real-terms disposable incomes rose by 5.2% across a group of top-performing urban areas between 2013 and 2023, compared with just 2.4% nationally over the same period.
Places including Warrington, Barnsley, Bristol and Brighton bucked the post‑2008 trend of sluggish income growth, translating stronger local economic performance into higher household incomes and reduced deprivation.
As a group, the 11 leading cities and towns recorded economic growth of 27% over the decade, well ahead of the UK‑wide figure of 18.4%. Centre for Cities argues that this underlines the importance of fast‑growing urban economies to the Government’s pledge that growth should be “felt by everyone, everywhere” by the end of this Parliament.
If all 63 of the UK’s largest cities and towns had matched the disposable income growth of the top performers since 2013, residents – representing over half of the UK population – would each have been £3,200 better off on average over the period, the report estimates.
Brighton, Worthing and London lead the pack
Brighton tops the league table for living standards growth, with disposable incomes up 8.1% and economic output up a striking 38.3% over the decade. Worthing follows with a 7.8% rise in disposable income and 29.4% economic growth.
London – despite its widely reported housing affordability issues and high cost of living – still ranks third on the list, with disposable incomes up 5.8% and economic growth of 18.9%. Other strong performers include Barnsley (5.6%, 18.9%), Warrington (5.3%, 41.0%), Bristol (4.6%, 31.4%) and Milton Keynes (2.9%, 22.7%).
By contrast, some high‑growth economies that have struggled with housing and space constraints have actually seen living standards fall in real terms. In Cambridge, real‑terms disposable incomes declined by 3% between 2013 and 2023; Centre for Cities calculates that residents there would have been £10,900 better off over the decade had the city matched the top group. In Wigan, where disposable incomes fell by 1.6%, the equivalent figure is £7,200.
For lenders and brokers, the divergence highlights how local economic strengths can still be undermined by affordability pressures – particularly in markets where supply has failed to keep up with demand or where planning systems are especially restrictive.
‘High housing costs eat into disposable incomes’
Ant Breach, director of policy and research at Centre for Cities, warned that housing supply is now a critical constraint on growth in many of the UK’s most successful urban markets.
“Cities need to keep pace with the demand for new homes as they grow. High housing costs eat into disposable incomes in successful places and are a clear sign of unsustainable housing shortages constraining cities’ growth. That’s especially true of London and other cities in the Greater South East like Brighton, Oxford and Cambridge, but growing cities like Warrington and Manchester need to plan ahead to stop costs becoming a problem in the near future,” he told Mortgage Introducer.
Breach argued that the root of the problem is firmly on the supply side.
“The policy problem lies on the supply side. Since the Town and Country Planning Act 1947, Britain’s planning system has been too slow to respond to high demand for new homes, creating a decades-long backlog of missing homes and pent-up demand. The 4.3 million homes now missing from our market compared to other European countries overwhelmingly should have been built in and near cities like London and Reading,” he said.
He added that the Government’s current reform drive will be crucial to reconnecting housing supply with demand in high-growth areas.
“The Government’s planning reform agenda is vital to reconnecting the supply of homes to new demand. Big cities will need more targeted interventions too. Large cities are not as dense as their G7 peers and a key aim of the Government’s reforms should be to build flats near existing urban stations. Handing mayors more powers over planning will help to unlock more investment in regenerating key urban brownfield sites, ultimately helping to raise national economic growth.”
Growth, not short‑term cost‑of‑living fixes
Andrew Carter, chief executive of Centre for Cities, stressed that while the cost‑of‑living crisis has rightly focused political attention on bills and prices, the only durable way to improve household finances is through faster economic growth that feeds into higher incomes.
“It is understandable that the Government has shifted its emphasis onto the cost of living in recent weeks, but ultimately it is stronger economic growth that raises household incomes. Without growth, cost-of-living fixes can only ever be temporary,” he said.
“Nationally, the last decade has delivered the same amount of growth in living standards as we typically experienced in a single year prior to 2008.
“In places like Warrington and Barnsley, economic growth has translated into higher household incomes and less deprivation. That isn’t accidental: it is shaped by policy choices on skills, transport, housing, and support for businesses.”
Carter argues that planning reform, further devolution and a clear Industrial Strategy are now “crucial for supporting growth in cities and delivering better living standards year after year”.
Three tests for policy – and a housing challenge
The report identifies three main levers for boosting living standards more quickly:
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Strengthening local economies, with a particular focus on growing “cutting‑edge” sectors such as life sciences, digital and AI.
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Improving access to opportunities by getting more people into work, investing in skills, and upgrading transport links to connect workers with jobs.
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Reducing constraints on housing and commercial space so that successful cities can absorb growth without seeing living standards eroded by spiralling costs.
For the mortgage markets, that final pillar is particularly significant. The think tank warns that even where incomes are rising, high housing and space costs can eat into disposable income, limiting the benefits of growth for households and businesses alike.
Carter notes that jobs in new‑economy sectors tend to cluster in urban centres and can deliver spill‑over benefits to the wider local “everyday economy”. But if workers cannot afford to live near these job hubs – or if firms are priced out of office, lab or industrial space – the growth model begins to strain.
Implications for lenders and housing policy
For lenders, brokers and developers, the findings reinforce several emerging themes.
Markets such as Brighton, Worthing, London and other top performers are likely to remain structurally in demand, underpinned by strong local economies – but affordability constraints will continue to shape borrower profiles, loan sizes and demand for higher‑LTV and shared‑ownership products.
Secondary and “left‑behind” cities that manage to replicate the policy mix seen in successful areas – targeted skills, better transport links, and more flexible planning – could offer significant medium‑term growth potential, including for regeneration and build‑to‑rent finance.
Where planning and land‑use reform is delivered credibly, it may ease some of the upward pressure on house prices and rents over time, creating more sustainable markets and potentially supporting a healthier balance between capital growth and yield.
Carter concludes by echoing the Prime Minister’s call for 2026 to be the year “politics shows it can help again”, arguing that the real test will be whether policy choices translate into “more jobs, higher wages, and stronger local growth in more places across the country” by year‑end.
