How are people affording to buy in London?

[absolutelyeverybody]

Looking on Rightmove at pretty standard terraced houses in ok but not super posh areas like Clapham, Fulham, Wandsworth - houses are £2m!

Who is buying these?!

Is it simply a case of family money/help??

And further in to zone 3, houses are £1m!! How are people affording this's?

People definitely do this. We got wills drawn up recently and booked the most basic will (free will month). The will adviser was pushing us to sign up for this type of will (property trust will) even though we had never heard of it as they can charge more money for them.

It’s a moral dilemma but definitely lots of people with large amounts of their wealth tied up in their property will opt for this type of will. I agree it could create future problems in society as care fees have to be financed somehow.

There is another thread running about how shaky this is legally and how easily this loophole will be closed. It’s not the flex people think it is

Ok

We bought a 4 bed house in London zone 2 with no family money or inheritance. DH is a high earner working in tech, and he receives shares as part of his package, which have increased significantly since he was first granted them. We know many families who can buy £2m+ houses here (met them through DC's private school), who mostly work in tech, finance, law, entertainment. No reason to think they have recieved family money to help them buy, as their income is as high or sometimes much higher than ours. Most of them live in zone 1 and 2, a few live further out in zone 3 (they could afford a terraced/semi house in z1/2, but moved out for a detached house).

Despite everyone earning 500k, London has definitely underperformed in recent years.

"In terms of house prices, London has struggled immensely in recent yearss_. The average price of a flat has not risen in a decade according to Zoopla data and a period of high inflation means that it has actually fallen by around a quarter in real terms."
"In the prime market – meaning properties worth around £1m or more – the reality is even more grim. Across prime central London, property prices have fallen 21pc from their peak a decade ago, or 42pc in real terms, according to data from estate agency Savills."

So it may get slightly easier to buy, who knows!

Generally the ones buying houses with new money (not inherited) are the same ones sending their children to private school, generally work in law, private equity and some in tech.

We bought our marital home from teachers. My DH was a city lawyer earning £500k. About two years later my DH said the house had gone up enough that he couldn’t afford to buy it. When he passed away, I sold to bankers. Three years ago I bought a house in same zone but a three bed terraced as opposed to a five bed detached, for similar money that we had paid 20 years before.
But I look at my neighbours and it’s a mix of middle aged couples and young families (three very good primaries within walking distance). I don’t know how they afford it - none of my friends parents would have 100-200k to hand over as a deposit.
But back in the 80s when we started buying, there was mortgage interest relief, friends bought together, and my employer was happy to put any figure I wanted (I said tell the truth). Interest rates were as high as 14%. We all bought in our 20s. I only know one person in their 20s now who has bought in London (high paying job with American law firm, though Trump may have an impact). My kids and my other friends kids are mostly living at home because they can’t afford to rent. They’ll have to wait til they have a partner and perhaps for their parents to downsize to gift them some money (all still working full time) and meantime save save save.

I remember buying my first flat in 1999. I started working in 1997 with a salary around 20k. I was living at home, so managed to save £1k a month for 2 years. Using that and some previous savings and help from parents, put down 45k deposit and got £100k mortgage to buy a one bed (£145k) in zone 1. Same flat is around £650k now. No chance would I be able to have bought the same flat now.

In DC's school 75% of the class (parents) are easily earning 250k+, when you search them on Linkedin, they are all MDs in Investment Banks, partners in Law firms.

Over 5000 properties in zone 3 London on rightmove at 350 or less

so not everyone is paying millions