Housing affordability has improved considerably for key public sector workers since house prices peaked in September 2007, according to new research from Halifax.

The survey shows that 41% of towns are now affordable for the average key worker, based on the ratio of average house prices to average earnings. Where the ratio is below 4.0, housing is deemed affordable. In September 2007, homes in just 3% of UK towns – 12 towns in total – were affordable for key public sector workers, demonstrating a significant improvement since 2007.

The Halifax Key Worker Housing Review tracks housing affordability for five groups of public sector workers: nurses, teachers, police officers, fire fighters and paramedics in 450 post towns (including 32 London boroughs) across United Kingdom.

Housing affordability is defined as the ratio of average house price to regional average earnings of key workers where the ratio is below 4.0 housing is deemed affordable, above 4.0 is unaffordable.

The calculation is based on a single income and is, therefore, conservative. The review is compiled using information from the Halifax’s own extensive housing statistics database and earnings data from the ONS for the period to March 2012.

Martin Ellis, housing economist at Halifax, said: “Housing affordability for key public sectors workers has improved significantly across the UK since house prices peaked in 2007. More than four in 10 towns are now affordable compared with just 3% in 2007. The greatest concentration of this improvement has been in northern England