If your house is worth £1m+....

[cumlaude]

Where I live, SW London, there are rows upon rows upon rows of streets of average looking terraced houses worth £1m+

I can't imagine everyone living in these houses earns the £200k single income, or two people earning £100k each, to secure such a large mortgage plus a very hefty deposit.

So if you live in a house worth £1m+ how did you afford it? Did you ride the London property wave, inherit some money, or just earn loads?

FWIF I'm a renter in a share house and I'll NEVER be able to afford to buy in the area I currently live.

(Also a prolific name changer on MN in case anyone starts yelling at me that it's my first post!)

When I lived in south London, I checked the past prices on the street and houses had gone from 300k to over a million in 15 years. So people on fairly normal London salaries had been buying them not that long ago.
Anyone selling up could have a huge deposit to spend elsewhere.

"No hope of saving and getting on the property ladder unless they flee London. Then who will teach the children and nurse the sick?"

I suppose there is a fairly steady supply of people entering the teaching and nursing professions who will think it is worth renting in order to be in London for a while, say up to their late 20s. So at the newly qualified end, there may not be such an impact. But what will be interesting is, as they grow older and move away in order to buy (if they do!), will we see a shortage of experienced teachers and nurses, eg to fill SMT and head teacher positions? I'd say anyone in early 30s or below may be in that category, so it may be a few more years before the effect would be felt.

I actually think there will be a shift particularly with the rise of remote working & more young people will choose other cities instead of migrating to London.

@BlueSkiesLies No need to get worked up. I’m just making a point that there there are places in London affordable to teachers or social workers and they don’t need to be a stabby armpit.

@fussychica People in public sector jobs, eg teachers do get paid quite a lot more in London than outside so can afford more expensive properties. So they would need to move to somewhere really cheap to enjoy a substantially cheaper property and more disposable income.

That is interesting fancynancy - i think if the young are never lured to London in the first place, that will make a big difference!

It does seem to be that once you're living in London, build up a circle of friends, get used to the amazing public transport, maybe have a first dc, then people find they don't want to leave. Whereas if you never come in the first place you won't miss it! If people are motivated by economic self-interest moving away is what should happen - it doesn't make sense, in the strictly economic sense, to work and rent in London rather than work and buy elsewhere (unless you have family child care which can alter the economic calculation). So far it hasn't really happened, has it ?- but maybe that will change.

SoonerthanIthought Admittedly the people I know who have left London don’t have family here but rather than choose the traditional move to Surrey or Kent they have gone to Bristol, Manchester & Edinburgh. Now they did have healthy budgets but they are living in amazing areas & their salaries didn’t drop a huge amount but I assume that’s career specific.

The economy would probably be in better shape if young people didn’t have to be spending so much on rent & or saving for a deposit.

True fussychic there is London weighting. Just checked and it looks as though an NQT starts on around £23,720, or £29,664 in inner London - so around £6k more. Still, if you're looking at borrowing 4 times joint salary (optimistic), that only gives you an extra £48k on your mortgage if you're a couple in London.

Though I agree you'd have to move quite a distance from London to be able to buy with a joint salary of £47k.

@SoonerthanIthought That’s just NQTs in their early 20’s, though.
I bought as a single teacher in London in my late 20’s (havings saved all of my own deposit too). For the same amount as I paid back then, you could get a 1-bed in zone 5 these days. So I don’t think the prices are as horrible as some people make out.

We were both high earners when we bought back in 2009. The house was worth 1m now worth 1.6m. We didn't have any help. Lots and lots of couples earn very high six figure incomes in our part of london.

We had a 2-up 2-down terrace in Hammersmith, bought in 1993 for £142k. We sold it in 2002 for £450k.
Our next door neighbour sold his house (exact same layout, no of beds, etc) in 2014 for £1.175 million....
It's absolutely silly money.

I bought my first flat for £24,500 36 years ago and DH and I have gradually worked my way up the property ladder since then to end up in a £1M+ property. Although with `brexit and stabbings in London I don’t know how long it will stay a £1M+ property.

I met a woman who’d been left a flat in the ‘80’s by an elderly aunt. She’d just left uni and wanted to go travelling so she sold it straight away. It was in a mansion block in Battersea, which wasn’t desirable in those days. She said all she could do was laugh when she thought about what she’d frittered away.

These probably are not first time purchases. I’ll be moving to London and the area I want to live in are at that price and more for a three bed terrace. That’s where I want to live so I’ll be funding it by selling my twice the size detached house with pool in a cheaper area and a flat in a slightly more expensive area in order to buy it mortgage free.
But I did once own a house worth over £2m. I met my husband owning a house worth £240k (bought two years earlier for £145k). I think I had a £100k mortgage. He had sold his marital home and his share after paying of mortgage and buying his ex a house for cash was say £150k. We bought our house for £1.25m, using our equity from our sold properties as deposit and he took a £1m mortgage. Eight years later (after extending etc) sold it for a bit over £2m. Paid off mortgage so I could now buy a house worth £800k mortgage free. Add a small mortgage and ta da £1m to buy a house.
My friends have a detached house worth over £1m in south London. They climbed the property ladder, both had separate flats, sold got married bought a semi with mortgage (both work full time combined salary say £100k at the time). Few years down the line mortgage much reduced salaries gone up sell buy next house for £700k, do loft conversion increase mortgage do rear extension. House now worth over £1m. Husband inherits a cottage from his mother they use as holiday home. So now not only own a house over £1m but second home owners too!
They started as journalists by the way not high flying city jobs.

Bought a flat in 2004 with 95% mortgage. Used profit on that as deposit for unmodernised house in 2010. DH and I continued up career ladder to over £200k, completely renovated the house including kitchen extension and loft.

I love living in London. So busy and modern. I have family in NI and whilst a visit to their big houses and gardens is nice once in a while, I find it far too backward (sorry). Attitudes to immigrants, gay people trying to buy a cake, women trying to access a termination (for example) and the Troubles make it a big no no for me, no matter how massive the houses might be for my money.

My house is a fairly spacious (but still only 3 bed 1 bath) London terrace - worth about a million now (more realistically £950,000) but it was £360,000 when we bought it in 2004.

DH bought in a rough part of London years ago (1998), paid off the mortgage (high ish earner too) then the Olympics happened and we sold it for five times what he paid.

We moved to SW London 7 years ago, made improvements to that house, sold up, made £220K on that and now live in a £1m + Victorian terrace. This will be our last place here before we move further out and build our dream home from scratch.

Combined earnings of 160k bought large 4 bedder for 164k 25yrs ago now worth 1.5.

regardless of location , it’s still only a tiny terrace for £1 m quid . Does the location really make up for the lack of space ?
We live in a terrace in NW London zone 2. It is NOT tiny or average. It is a beautiful spacious Edwardian terrace with a small garden in an area full of similar houses. The area is gorgeous, very green, friendly, quiet etc but 20 mins to Leicester Square. We come from here, this is home so where should we go??
there are an awful lot of pensioners living in £1m+++ houses but not enough thirtysomethings able to buy from them and many of the 30somethings will probably inherit from those pensioners

Moved to London in 2006. Combined salary £200k +
Bought a house for £800k (in the wrong place)
Both made redundant in 2008
Haven't had a "proper" job since (too old)
House worth at best £650k
Looking to cut our losses, downsize and retire on what we have.

We are zone 6 London and yet an average family home is at least 750 if you want to be in catchment of the good schools!

One clearly benefits from:
Being a high earner
Receiving an inheritance
Buying before the noughties

Dh and I do not fall into any of those categories. We have accepted the fact that we are unlikely to move back to London., even the outskirts. If we work locally our salaries would drop by £10k to £15k. We cannot afford to take that drop so commute we will do!

Bought a 2 bed house in Zone 3 in 1999 for £155K - DH had £60k deposit from an inheritance. Both had good graduate jobs.

Sold house for £270k in 2002, bought a 4 bed terrace for £390k in Zone 3. Paid off mortgage in about 2012, got about £120k gift from DH parents which helped a lot but DH is a high earner and household income currently £200+ plus bonuses. Carrying on saving for 7 years.

Sold house in 2019 for £820k and buying a 5 bed detached for £1.5m with £500k mortgage.

We have been incredibly lucky with help from DH's parents, very well paid jobs and a couple of windfalls from redundancies. We have, however, saved very hard over the years and not been very extravagant with cars or holidays.

I'm sure there are those who'll shout 'not fair' and it's certainly not but we have paid an awful lot of tax and DH has had a lot of work stress.

My parents aunts and uncles bought 4 bed houses in Ealing, Harrow and Shoreditch in the late 80s. All worth over £1m, admittedly the Harrow one had a big extension put on which helped but the others are still 4 bed 2 bath houses in good but not top notch condition. The areas have become very desirable, and the prices have gone up.

My gran thought they were mad to buy in Hackney, but look at the prices now!!

I know a colleague who paid 700k for a house in hackney & did a bit of work. Sold it 3 yrs later for 1.4m.
Shame I wasn’t born in the 70s!

I am amazed by this. How do you guys feel knowing you live in million pound houses?

I love Mumsnet for this. You can be having a discussion with someone about absolutely anything and it turns out they live in a million pound house and you don’t know it. That wouldn’t really happen in real life.