To ask about London and money

[Maisy313]

How much do you think you need to earn as a working couple to support a family of four (one year old and reception aged child) in London and have a reasonable standard of living? Would just be really interested in your thoughts... Someone told me it was impossibly to survive on less than a joint income of 100k in London which seems exceptionally high to me...

CactusAnnie I'm sorry you feel that way about what I posted. My mum is from London and I have more family here than I do there. Does that make me acceptable?

To the person on 25K, I guess you qualify for tax credits etc, which must help a bit.
The OPs sister probably earns too much to qualify for any of that, but might still be getting child benefit.

Other posters, do you think I'm right in saying that if the family have 75k and are fairly frugal with other stuff, they are likely to be left with about 1-1.5k for accommodation and childcare? If I'm in the right area with those numbers, there are 2 Qs;
-is the 100k deposit plus earning a enough to get a mortgage big enough to provide them with the accommodation they need
-more importantly, is that 1-1.5k enough to service it - ie to make the monthly payments AND cover childcare?

I suspect it might be just about enough to cover a mortgage, but adding on childcare too might tip the balance.....and this is why being outside London will help.....but whether the mortgage savings will be enough to cover the huge costs of childcare is hard to say.

Will 2 children be in full time childcare?

I've heard of Ruislip, will look at right move, thank you!

Thanks chocolate wombat, one in school (with hopefully breakfast and after school club) and not with childminder or nursery.

I actually have every sympathy with immigrants from poor parts of the world who come to London, struggling to get by like the rest of us, but it's a bit shit when wealthy people from rich countries come to live in london, push up house prices, shrink catchments, and then complain about it!

Assuming that comment was directed at me, believe me, DH and I are not amongst the wealthy. Far from it. You want to complain about wealthy people from overseas, it's not hard working people like us who are very much part of the community. I contrast this with the wealthy from Russia, the Middle East and South East Asia who buy up prime properties which then sit empty.

It's scary but id say a joint income of £100k is probably 'comfortable' in London (outside the really expensive areas) but you certainly don't feel rich and do have to think about what you're spending!

I used to live in the borough of Hounslow (Isleworth comes under Hounslow). It's okay I guess - parts of it are really awful, but there are nice parts - that's pretty much the same anywhere I guess!

What we've actually done now is move outside of London (we've gone west, kinda towards Slough area) and have got a 3 bed house with a decent mortgage for less than half of what the rent was in Hounslow. DH and I both work in the borough of Ealing and commuting isn't actually that much different compared to when we lived in Hounslow.

Anyway, short version of the story - try looking at the trainlines/commuting routes and see what kind of areas make good commuting (Ealing Broadway is on the same mainline route that goes through Slough for example) and it may be possible to get a nicer place for far less.

If definitely looking at West London - I would say Brentford is okay. By the river, there are some nice newish flats around there that might be worth looking at. Kew and Richmond are pretty expensive these days but are really pretty, especially in summer. Twickenham is decent, but obviously gets really crazy busy when there are big rugby matches on. :-P All of those areas have good schools for the reception aged child. It's the childcare for the younger one that will be expensive... But then that would be true no matter where in the country I guess... I don't really know on that one...

Isle worth is ok but warn them to be careful not to be downwind of the sewage plant. Same applies to Whitton. Eastcote and Ruislip are nice but quite expensive. Rayners Lane might be a bit cheaper and has good schools. I used to live in Feltham, which is unlovely with lots of traffic and airplane noise, but it's quite a practical place to live - good transport links.

We left London though, despite both of us growing up there. We had a similar joint income and deposit and just couldn't find a house within budget. We have a lovely house and life now, despite staying in the South East. London housing is nuts.

So if the little one is in full time daycare, you could be looking at that costing over £1k per month, before any accommodation costs - £1k is £250 per month or £50 per day...and most cost more than that.

If I'm right about there being able £1-1.5k for housing and childcare, that leaves less than £500 for the mortgage.....not enough really, whether in London or an area outside it. So it will be the childcare that makes it not doable...realise childcare doesn't cost forever...but you could be looking at 3/4 years of it.

Can people buy a family house/flat in commutable distance of London with a deposit of £100k and face less than £500 mortgage? Is it possible?

Isleworth is a short bus journey from Hounslow East which is on Piccadilly Line so that would be easy to connect with Gloucester Road (is that Charing X stop?) Isleworth feels quite low - many Victorian/interwar terraces, bit of aircraft noise not so many trees in the streets but some lovely parks around there, the river and Twickenham nearby. Seems very nice for families; my daughter goes to school there and her friends live happily in the area. Not great for tube connection and buses can get very busy at peak times.
There's a very nice park Linwood Park behind the Treaty Centre in Hounslow incidentally - I went to visit someone there and was impressed by quality of life for families; small Victorian terraces and busy main street with lots of shops and then the all important Piccadilly Line.

The problem is the deposit -most people I know in Z3 at local state schools live on much much lower income than you have described, but they bought houses/flats when they were so much cheaper 10 or 20 years ago, or they are in housing association properties or council houses. OR, they get housing benefits to top up their income.

Hearts
we all need after school care. Just because we dont earn much and we don't have your 'lifestyle' and private schools doesn't mean we work 10am-2pm.
OP with 100K deposit they can make it work if they buy a 2bed flat a bit further. They will have smaller mortgage than if they bought a house closer plus less running cost for heating plus cheaper childcare probably.

Dh and i lived in the w4 area for abit (a few years ago) before we moved further out to another area of london which was slightly cheaper. It was very very expensive. Rent £1200 per month. Might be more now. It was a half life as most of our money went on rent. Without family help we couldnt have lived there. So glad when we left, although i miss the people from there. We now have completely left london and the only reason is cost of renting (buying isnt an option due to the cost). I think you could live on less than £100,000 (we certainly lived on an awful lot less than that but we were only a couple). If you can sort out the accommodation problem cost wise its not expensive. Food etc is the same price as anywhere in uk. That area of london is beautiful with a village feel and very friendly people. X

Yes, we do qualify for tax credits. Not a lot, about 2k/year. Pays for school dinners. So still on a total income of 24k.

As of April 2016 I don't think we will get any. I don't rely on them as I've always thought they could be taken away at any time.

Would they consider shared ownership OP?

Wombat- 500/month is doable if you have an interest only mortgage.

You have to consider what you'd do at term though, remortgage, move? We plan to downsize or relocate with the equity once the kids have left home.

The other thing about London is when I left 2 years ago a packed lunch and a £2:40 day bus pass on your oyster would be all you needed to see The British/Science/Natural Museum, Tate modern/Tate Britain/National/Portrait Gallery, so many parks with wonderful playgrounds and so, so much more. That helps with some costs.

I'm kind of surprised by this thread, just like I'm surprised about all the 50 quid a week on grocery threads for the quite opposite reasons.

SW London, in a comfortable cycle commute distance to hammersmith, we rent a pretty crappy but perfectly reasonable and habitable 3 bed house with a garden, close to good primary schools easy to get into via proximity, and a nice area. Run a car, although no need to if it wasn't for hobbies, holiday regularly, enjoy good food, don't go out much to expensive meals / drinks, but plenty of cheap outings, and lots of money spent on hobbies.

I'd say we'd need a monthly after tax and childcare income around 3k to live reasonably, and ~4k gives us the ability to not really think about purchases. Obviously us both having a background of frugality means we buy efficiently and not extravagantly. That's well under 100k.

Mind you, buying is actually more expensive here, even with 100k deposit.

I was thinking "surely you could manage cheaper than 1K a month with a childminder, but then I did the sums and Googled and apparently no, no you couldn't.

But is your net income calculation correct Chocolate? Depends on the income split between the couple I guess. When's the new tax-free childcare scheme meant to be coming in?

If they live in Bristol and have decent jobs and accommodation, it may well be worth staying put at the moment.

When I look at the figures on this kind of stuff, it seems to me that the only people who can afford family houses in London are those who bought long ago before prices rocketed, so who have little mortgages, or those who earn mega bucks. In order to move there from somewhere else, people need mega mega bucks in terms of earnings or huge deposits.

It strikes me that the people who have the smaller flats in London or the houses outside London and who commute in, afforded that, by buying BEFORE they had children....they struggle thought the years of childcare costs by either not working and having a much lower income, using family for childcare, or using up savings or possibly building up debt, until they can get onto a more stable footing once childcare costs drop or end.

The idea of moving to the most expensive city, from elsewhere, when you already have 2 kids, the point when your expenditure is at its peak due to childcare, will never be easy or possible for most people. Those people face the double difficulties of not having big enough deposits to be able to get mortgages down to a reasonable level, whilst also being burdened with massive childcare bills.....it's a killing combination.

OPs sister could wait. They could wait for childcare to end....yes, house prices will continue to rise in that time. However, 4 years down the line,the big expenditure will JUST be housing and at that point, a flat in London or more likely a small family house outside of the M25 but commutable could be an affordable option.

&100k joint income here has a nice life outside of London- commuteable
In London we couldn't even afford a 2 bed flat to rent and childcare on same amount without living in questionable area
Is commuting an option?

Fredfredgeorge 4k after tax month is equivalent to £70k isn't it?

Anyone, I don't know. Do you think they would have more than £1-1.5k for accommodation and childcare?
I was thinking that they would have a net household income in the region of £3-3.5k. Perhaps they would have a bit more and have more like £2k for housing and childcare???

We live on about 75k in z4 se London and feel very comfortable- certainly none of our friends earn much more than that- all healthcare/civil service/teacher/charity types. We live in an unfashionable area though- but great transport and can be in work centrally in about 35 minutes.
We wouldn't consider private school and do not run a car. No debt. Only one dc though and nursery costs about £700 a month because we get some employer subsidy. We could still manage with 2 and the funded 30 hours will come in next year.
I think it totally depends on your lifestyle and expectations. We have holidays and savings. It's easy to spend a lot but also easy to live quite cheaply if you have a manageable mortgage (1100 ish) (we moved from a flat somewhere even less fashionable but did give us some equity). 100k seems daft to me as a minimum- I don't know anyone who earns that as a single or couple (but I don't really know anyone who lives in West London either).

If both of them are working, which is how it sounds to me, they will have 2 lots of tax free £10k and it is possible neither are higher rate tax payers and they get child benefit. If all this were the case, £65k (I think OP mentioned that amount up thread, but I might have imagined it) might deliver a net income of around £3800.

Am I living in a parallel London

Obv depends on mortgage/rent, and whether you're paying for school fees etc, but I am amazed at pp who said even without children and paying less than £1500 a month rent, £120k is "basic"! What the hell does the other £5k a month go on then, with no children??

Depending on what your mortgage payments are, perfectly possible to live on much less than £100k. And if you can't afford mortgage payments on a flat in areas like Kew or Chiswick (neither cheap) look at other areas. Plenty of lovely lovely places in zone 2/3 with very do-able commute. London doesn't stop at zone 1 you know