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To wonder how ordinary people can afford to live in London?

240 replies

Rhine · 13/08/2015 21:50

By ordinary people I mean those of us who aren't millionaires, oligarchs and trustafarians. Obviously there must be ordinary people living there, but how on earth do they afford it? To buy there is eye watteringly expensive, so I suppose they must all be in rentals but then the rental prices are bad enough.

To get things in perspective you could probably get a five bed detached with land attached for the price of a small one bed flat in central London.

Pardon my igorance on this matter but it's always baffled me. Where do all the taxi drivers, shop workers, hotel staff, police, fire personnel, doctors, nurses etc live? Do they live in social housing, or are they miles out and commute in every morning?

It's a bit hard for a small town girl like me to get my head around.

OP posts:
Whatsforsupper · 13/08/2015 23:23

London will correct itself in time.

The market is driven, by low interest rates, central bank intervention, hot money from Russia/China and Europe with lots of buy to let.

Anyone, who says that this market is normal are mad(Its not only London and the south east, its also New York, Hong Kong) all having major influxes of money looking for a return, inevitably it will fall.

Markets correct all the time. Ireland, The US, Spain the UK in the late 80's all had there property markets go south we all saw the outcome.

CalmYoBadSelf · 13/08/2015 23:33

London is polarised.
The "haves" are those who are highly paid, get social housing or have inherited / been given large amounts from family who have benefitted from the London property boom
The "have nots" are averagely or poorly paid, in the private market and, often, from outside the area

One reason I am against getting rid of inheritance tax is it allows the passing on of more of the unearned profits from property in the SE which will just perpetuate the division between those in the SE and the rest of the country

MysteryMan1 · 13/08/2015 23:55

London is a funny place but it is quite unlike anywhere else in my opinion. It has some of the most talented people, the pressure, the buzz etc.but it can wear you out. I wouldn't have kids in London either.

Yes it is expensive but it's a case of either you can afford it or you can't. As mentioned, plenty of places if you are looking to commute. I belive the average Londoner travels 1h 15 each way.

A combined salary of £70k is plenty but you won't have a house. Be happy with that and it offers opportunity like nowhere else.

Sapat · 14/08/2015 00:26

I can't. 3 hour round commute for me.

Sapat · 14/08/2015 00:40

(I work full time and have 3 children, so in Herts/Essex we get a nice house, 3 beds, good schools but my working day away from home is 10 hours on a good day, 13 hours not unusual. What we save on mortgage we spend on childcare). For us though DH does not work in London so we both commute in different directions.

In my office my colleagues either live in shared houses/flats or bedsits. Interestingly only one person with a child lives in London. All the families (though singles are the majority at my work) live out of Lindon with at least a 50 minute train commute + tube.

alleypalley · 14/08/2015 01:09

I'm a publican, a manager for a big pub company. I've lived in Mayfair, Leicester Square, Angel, St James, and now Clerkenwell. I get earn a decent basic salary plus bonuses. We are in a 4 bed flat above the pub, don't pay rent, travel or utilities, we do pay council tax.

It's hard work and long hours, but we wouldn't be able to live here otherwise.

Mrsfrumble · 14/08/2015 01:19

I think a lot of people (us included, when we lived there) just have different standards. We felt lucky to be able to rent a decent sized 2 bedroom flat in zone 2 with our two children. Even when DC2 turned out to be the opposite sex to DC1 we just accepted that they could still share a bedroom, and we'd just worry about the teen years when we came to it.

We didn't need a car, and walked most places so saved money there. We did spend quite a lot of money going out, but didn't have a TV so didn't need to pay for a TV license or Sky subscription.

The idea of never owning and spending 50% (at least!) of your income on rent is horrifying to some people, but because we really wanted to live in London we just had to accept it.

GuybrushThreepwoodMP · 14/08/2015 03:50

DH and I rented a lovely 2 bed flat in zone 2. Between us we earned about £70k and paid out £1300 per month in rent. It was sustainable until we had children and wanted more space and a garden so moved 50 miles out of London. We now still spend £1300 in rent but have a 4 bed house with garden for our family.
But had we not needed more space, we would have been fine still living there.

CityBeach · 14/08/2015 04:38

I live in a fairly nice but not highly desirable north London suburb. Kids attend local state school, and thinking of all their parents and all the people we know who live in this area, I'd say it is do-able, but really massively depends on your expectations.

Aside from those who live in council accommodation on benefits or very low incomes, most people we know live in flats - either rented or with mortgages. My two best friends, for example - who are a head teacher married to a business analyst and a solicitor/single mum respectively - live in flats with their partners/DC.

Those who live in houses tend to be the older parents - 40 upwards (of which we are one), who bought in London some years ago and have profited from it.
We live in a 4 bed semi with garden, but we bought a smaller place years ago in an area where prices went through the roof. We were just lucky, really. Our house is worth a million pounds now and it isn't even an amazing house or area. No way could we afford anything near that if we were starting out now, obviously.

CityBeach · 14/08/2015 04:43

And I'd add that the 'ordinary' people we know who weren't prepared to compromise and live in flats with kids forever - social workers, police officers, teaching assistants, administrators etc - did, obviously, leave London. We have various friends who have moved to Kent, Bedfordshire, Middlesex just to be able to get a afford a three bed terrace house with a backyard. Have to weigh up commuting costs, though.

jellyjiggles · 14/08/2015 05:04

The people I know who live on London.

2 have no kids and in each case one of the couple has a massive salary. Well into 6 figures.

Family with two children live in a house with garden but can afford it because they bought their first house 10-15 years ago. The price of this house went from 250k to 900k over an 18 month period!

jellyjiggles · 14/08/2015 05:04

They all live either in the centre or 20 minute tube ride.

FreudiansSlipper · 14/08/2015 06:23

Lots of people i know including myself (single parent) do not have a high income some bought a while ago others rent without receiving benefits

I have a flat I rent out (suburbs) I hated living there and will never move back I earn a little from this and rent where I live rent is higher but I love living In London we have a good standard of living you manage with the money you have. I know a few singles flat sharing I did has great time and young couples sharing who prefer to spend money on holidays etc before buying

I could not afford to buy on my own again so will have to stay renting. Things will change London is constantly changing

Jelly I think someone is exaggerating while house prices have risen at a ridiculous rate once again like they did before this last crash three times the price in less that two years mmm....

Howcanitbe · 14/08/2015 08:13

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ValancyJane · 14/08/2015 08:31

The people I knew mostly rented and knew they were compromising on living in a small space to live in London. I lived there for a year (in zone 4) and in a pretty smallish room in a flatshare for £550/month and was happy, but could never have afforded to rent a place of my own that wasn't a bedsit, and god I could never have have bought anything. I worked with a lot of teachers (so they were on a decent salary) who were my age, and most were renting. Those who had bought had either moved out of London and commuted, or one of the couple worked insanely long hours in the City in a highly paid job. Most of the 'normal' people I knew who owned property in London were older and had owned it for at least 15 years. One woman I knew had a nice house in Highgate, bought for a decent price in the 80's and was now worth over a million. It's crazy!

I moved back home (up north) for family reasons, our mortgage is now only £250 more than I paid in rent in London each month for a large 3 bedroom semi detached! It's insane. I loved living in London, but even when I moved there I always knew it would be temporary because of the housing situation.

Rox19 · 14/08/2015 08:41

I don't understand jewels.

So your deposit is £150k.
You can borrow 4-4.5x joint income so £600-675k plus deposit £150k up to £750/800k approx

You could get a 3/4 bed place in most of zone 3 or 4. What's the problem? You expected to be in zone 2 on that combined income?

Everyone I know in zone 2 who has bought lately earns around £250k combined(ie 2 earning £125k each approx plus giant bonuses).

Howcanitbe · 14/08/2015 08:42

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itsraininginbaltimore · 14/08/2015 08:43

I agree with citydweller only low income workers and benefit dependent people on full or partial HB or very rich professionals can afford London now. Young successful couples buying 'family' homes (and I use that term very loosely) have to compromise massively on space if they want to be in a decent area, or they compromise massively on area if the want even half decent space.

To put this into perspective, I bought a one bed Victorian conversion flat in zone 3 in the late 80s as a very young single woman on a fairly modest salary, with a 95% mortgage although I can't remember how much I paid for it.

I have just looked at the same road on rightmove and if I were to buy that flat again today I'd need around 300 to 350k. If I were 22 again and working in a similar job to the one I had, there is no way on earth I could buy that flat now.

itsraininginbaltimore · 14/08/2015 08:47

I also completely agree with jewels about the type of house that is affordable to relatively affluent young couples in
London who are neither stinking rich nor totally benefit dependent and able to rent somewhere quite nice on HB.

I think if you can't be somewhere reasonably nice in London then I'd rather not be in London AT ALL.

Howcanitbe · 14/08/2015 08:51

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chanie44 · 14/08/2015 08:53

A lot of homeowners have bought into the hype of what their property is valued it, but it's unrealistic.

Mil bought her property from the LA for pennies as the area wasn't desirable and it has increased loads since then.

Mil keeps saying that her neighbours have sold for xxxx and every time I see her, she adds another £50000 onto the value of her property. However, when I checked online, none of those properties sold, so despite the neighbours trying to sell, there have been no takers.

Howcanitbe · 14/08/2015 09:03

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stripytees · 14/08/2015 09:15

Zone 2-4 especially in SE London was a lot cheaper 10-20 years ago. That's when a lot of the people I know bought. It was easier to get mortgages then. A professional couple with some savings could easily buy a £250k big house that's by now more than doubled in price.

Everyone I know in zone 1 is either getting housing benefit, in social housing or bought their place 20 or more years ago. Or only living in one small room in a flat share. Others live further out.

I bought my zone 4 house after I inherited. I refuse to feel guilty about it because I would rather still have close family than the money.

I want to leave London eventually because I hate how crowded it is and how the cheaper areas are full of people who don't care about where they live.

Wincher · 14/08/2015 09:24

We bought a flat, with the help of an inheritance, in a then-unfashionable area of east London 8 years ago. We have since moved up to a house which needed lots of work for not much more money - and since then prices have gone through the roof. Our house (with the work done) is worth twice what we paid for it less than three years ago. Crazy times. Most of my friends in the area also bought a few years back when prices were affordable. Sadly those who rent are gradually being forced out of the area as rents are going through the roof.

GladysTheGolem · 14/08/2015 09:27

Zone 4 here.

I grew up in zone 1 & everyone I went to school with was either council houses & benefits or wealthy white collar background, so I have no idea!

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