Was central london affordable (ish) to live in in the 1990s?

[Theendofspring]

And when did it become completely unaffordable and the rougher areas gentrified a bit? Reading a book which got me wondering.

I worked out I would have been better off getting a retail job at 17 & buying a grotty flat at 19 as I would have made huge gains. Instead I would to uni 🤦🏻‍♀️

went!

Interested in the book you’re reading OP @Theendofspring .
I also find it crazy that successive governments have let these extraordinary price increases to happen.
Have always assumed that it was partly because so much was sold off to wealthy non residents who invested their money in London, effectively pricing out people with normal salaries, but perhaps there are other explanations?

Me and DH bought a 2 bed flat in SW London round about 1999. It was £90k which was just about affordable at the time with two very average about 3 years out of uni salaries (not graduate jobs).At the time, we could have got a flat about £20k cheaper but a maisonette instead of a block. If we had wanted to live somewhere like Teddington or Twickenham we could have done so for the same price but a smaller flat. We had a small deposit of a couple of thousand from memory and we were in. It was cheaper to buy than to rent, our much smaller not so nice area 1 bed flat we rented before we bought was about the same price per month.

Moving closer into London it was expensive and definitely not affordable for most in nicer areas with normal salaries by the late 90s, but definitely lots better than now. I remember watching Bridget Jones Diary when it came out and thinking there was no way she would have been able to afford to live in pretty central London with the kind of job she had and flat. Lots more parts were
run down though and not gentrified so they would have been affordable but not necessarily feel that safe to live.

Forest Hill I remember being very cheap. My friend had a very large 2 bed mansion block flat she bought for £45k a year or so before us. Dread to think what that would cost now.

It's all very depressing, we own and I would very much like prices to drop I don't think it benefits anyone. London is going to become a city of old people who have lived here years or the rich. The vibrancy and difference will disappear along with young people who help make it so.

@gegs73 DH and I bought a 2 bed flat in north London in 2019 and we were on average wages. Aged 27 and 29, same age as his mum when she bought her first home in 1989. Not rich. I don't think it's unattainable to buy a flat, what is harder is the 3 bed places.

DH and I just viewed a 3 bed flat flat in Ealing for £550k yesterday, hoping to upgrade to that. Might manage £600k-750k zone 3 flat in a few years...the house my MIL bought in north london eventually is quite a small terraced and I think quite cheap for the area

The £1 million houses in north London or even the 800k houses in Surrey/Herts/Bucks (plus commuting fares) are unattainable for people without family help, a lot of equity or high incomes.

Worked in W1 in 1990s. The only people who lived in central London had other income or lived in family owned property. Most lived a commute away, in outer London boroughs or beyond M25.

Friend of mine bought a 2 bedroom maisonette in Battersea in 1993 for £60k and rented out a bedroom. Lots of people I know did similar in the early 90s. These were people who were out of Uni by 2 or 3 years and working in publishing or similar so not especially well paid and usually not with family help for the deposit as you could buy with a very low deposit at that point.

Had a friend who bought a nice 2 bed garden flat in Clapham for £60k in the late mid 90s. Would probably be £600k today.

Our first flat (zone 1) cost £250k in 2001. I was on £32k. Same flat now worth about £800k and my old job now pays £52k- good example of how much house prices have risen compared to salaries.

DH bought a 2 bed flat between zone 1-2 in 1990 for £150,000 on his wage alone. Its worth about £700,000 now but haven't had it valued in a while. The area was 'a bit edgy' at the time, but now its full of hipsters and very trendy.

• Edit- he bought the flat in 2000, not 1990.

I think the low point in prices was about 1995-96, but interest rates were really high. We bought a 3 bedroom house in Zone 2 for £65k in 1997 on one salary as FTBs. But it was a wreck in a cheap area in SE London (since gentrified), we were priced out of anywhere considered nice at that time. ( It's long sold btw we aren't sitting on a million). Within 5 years it would have been unaffordable and it's got steadily worse in London since.

It wasn't for me, hence why I moved out in 2003, but I do know people who managed to buy in the late 90s and then got completely priced out of their own area. For example, a friend on a very average income bought a 2-bedroom flat in stoke newington in the late 90s but is still there (3 kids and a dog later) because they love the area but there's not a chance in hell that they could upsize.

The biggest issue is that house prices in Central London (and everywhere really) have increased enormously since the 90s but wage growth hasn't kept pace.

If you look at inflation calculators, something that cost £100,000 in 1994 should cost £170,000 today if it was in line with general inflation rates. A property in London that cost £100,000 in 1994 would probably cost at least 8 times that today.

The Nationwide have great statistics on this. FTB house price/earnings,London and UK,

Not in zone 1

Some parts of zone 2 and 3 were affordable too many

but also they were no where near as strict with lending money. I bought in 2003 a flat in zone three for £120. I had a deposit of £20k (inheritance) and I was earning £24k plus a bonus of around. £4K

they added cash in hand jobs I did (there wasn’t any)

renting was lower but some of the flats I’ve rented were awful we just accepted poor conditions

I bought a studio flat in Wandsworth, top of the common, for £55,000 in 1990, I was late 20s and earning about £20k, but had the deposit from money that was left to me. I had an endowment mortgage which was about £100 per month.
I looked at several flats at the time, most of owners were selling at a loss as it was just after the crash when house prices fell drastically. Several friends bought bigger places, with the idea of renting out a room but I was fed up with sharing and was ready to live on my own!

Seven years later we moved down to Devon for DHs job, we sold his flat to pay for our house, but we couldn't sell mine as there was a problem with the freehold, so we still have it. It has been rented out.

Everywhere in London was cheaper then but it was a lot grottier. The population of London has exploded since of course, which has pushed up demand, but the
relationship between wages/salaries and house prices has been busted completely now. Very low interest rates means property is now a good, safe investment, and if people need homes too bad.