Property prices in the countryside are, on average, £27,000 (16%) higher than in urban areas, according to the latest annual Halifax Rural Housing Review.

It calculates that the rural premium has increased 35% over the last decade, up from £20,000 in 2001.

Average property prices in rural areas have increased more than urban areas in monetary terms over the past 10 years. Rural property prices rose by an average of £69,170 – equivalent to £576 per month – from £127,146 in 2001 to £196,316 in 2011. In comparison, urban areas saw an average increase of £62,223 – or £519 per month – from £107,130 to £169,353. In percentage terms, however, prices in urban areas have risen by slightly more than in the countryside – 58% against 54%.

Since the housing downturn started in 2007, property prices in the countryside have fallen by 22% and in urban areas by 23%.

Halifax says the strength in rural property prices over the past decade has resulted in housing becoming less affordable for buyers on average incomes. This is particularly true in the South West which has eight of the 10 least affordable rural areas in the country.

West Dorset is the least affordable rural area in Britain – measured by the house price to earnings ratio – with an average house price that is 8.0 times local gross annual average earnings. South Lakeland in the North West and Ceredigion in Wales are the only areas among the least affordable local authorities that are outside the South West.

The house price to earnings ratio for all rural areas is 5.6. This compares with an average of 4.8 for urban areas.

There are only five rural areas where the ratio of prices to earnings is below the historical long- term average of 4.0. Copeland in Cumbria (3.3), East Ayrshire (3.4), North Lincolnshire, Allerdale in Cumbria (both 3.7) and Northumberland (3.9) are the most affordable rural areas in the country.

Uttlesford is the most expensive rural local authority district (LAD) in Great Britain with an average house price of £307,507 57% – or £112,000 – above the national rural average (£196,319). East Ayrshire (£103,981) is the least expensive rural area in Britain

15 rural areas have seen average property prices more than double over the last decade. The biggest increases were all in Scotland with the largest in Moray (162%) followed by Aberdeenshire (150%) and the Highlands (143%). House prices in seven Welsh LADs rose by over 100%, including Gwynedd (124%), Carmarthenshire (120%) and Ceredigion (119%).

In 2001, average property prices in the rural south (£171,000) were 75% higher than in the rural north (£97,828) in 2011 the difference has narrowed to 52% (£252,696 in the south and £166,167 in the rural north).

This narrowing has been driven by an average house price increase of 70% in the rural areas of northern England, Wales and Scotland. Rural Scotland had the largest rise in Britain with an average increase of 101% from £79,104 to £158,923.

Rural areas in southern England, on the other hand, have seen more modest increases although property prices remain at a significantly higher level. Property prices in the rural areas of the South East grew by 40% over the decade and by 63% in the South West.

Whilst first-time buyers in rural areas pay an average property price that is slightly lower than in urban areas – £132,309 against £137,183 – buying in the countryside has become increasingly more expensive. In the past decade, the average price paid by first-time buyers has risen by 90% across rural Britain compared with an 80% increase in urban areas.

A third of all property transactions in rural areas are accounted for by first-time buyers compared with a half in urban areas. The difficulty facing first time buyers in rural areas is most acute in southern England. First-time buyers account for only 15% of all transactions in East Dorset, 16% in Mid Devon (16%) and 17% in South Buckinghamshire, for example.

Social housing provision is much lower in rural areas of England and Wales with just 13% of the housing stock accounted for by social housing compared with almost 20% in urban areas.

There are five LADs where social housing accounts for less than 5% of total housing stock.

These are all in Wales: Isle of Anglesey, Carmarthenshire, Gwynedd, Pembrokeshire and Powys.

East Ayrshire has the highest level of social housing in rural Britain (23% of total housing), followed by Allerdale, North East Derbyshire, Copeland (all 20%).

Nitesh Patel, housing economist at Halifax, said: “Living in the countryside is an aspiration for many homeowners