To think London house prices are unjustifiably high

[Alanis126]

I was recently visiting London, where I once lived. It was a big big struggle financially and I wasn't sorry to leave. House prices have been stratospheric for 20 plus years and while there have been some small declines in recent years, I saw a central and fairly nice but ordinary sized flat which cost £1m. There are of course many properties costing way more. There are a couple of things in particular that I don't get. Forgetting the £1m central flats, even a very ordinary property in a quiet zone 5/6 area without much in the way of social amenities was £400k plus. While some people have family money, I think it is fair to say most people start their working lives with no or negative net worth. For many the early/mid twenties will be the lowest point if their income and when they most would like to or benefit from having access to social amenities. When even rent in a grotty house share is £800 plus bills, I don't see how it becomes feasible to live while you are trying to build a career. I know there are other cities but what if you have a job in an industry only existing in London? If houses are £2m or £3m then does it matter anymore what the price is? Could they be worth £5m, £10m,£150m? And while I accept people may still choose a London lifestyle, if someone has London equity and doesn't enjoy their job, is it only fear of being priced out for good that stops them relocating and having a total change of lifestyle?

@Henlie, this stat isn’t measuring well being directly but it does show health and social problems are worse in more unequal countries.

While I do think there are many issues with the housing market in London I think people do slightly overestimate how expensive it actually is to buy a flat. I earn £45k so not big bucks by London standards, have saved almost 20k and I’m buying a one bed. Now I realise I’m already lucky and privileged to have a salary that’s greater than 80% of the population and to be able to save, but it isn’t impossible, two people on 25k in London could do it. I didn’t even have a 10% deposit.

That’s not to say there isn’t an issue though. shared ownership for example is supposed to be an affordable way to own, and yet the extra fees mean the real monthly costs are more expensive even than renting a similar flat and you actually need to be earning 50k+ to be eligible. Who is that actually helping?!

I work for a company that advertise luxurious London properties (think Knightsbridge) air bnb style to overseas visitors at a hefty price tag.

London properties are an investment, but if it means we can bring in money from abroad then I don't think it's such a bad thing. You will find this is most major cities around the world.

@dodgeballchamp the average salary in London is 40k.

As @SympatheticSwan says, if you’re a couple, even a cleaner and a builder with little English can do it. Other examples of people I know who have recently bought are my friend earning 30-35k, a single mum with 0 maintenance . Also a guy at a local coffee shop - him and his wife are both baristas but have worked 50-60h a week and living on the cheap in a flat share to save up for a deposit.

PS my examples are from 2019 and normal flats (not SO).

@Chocpear - that source you quoted was from 2009. It would be interesting to see if a more recent study had been done, and if so had the results changed.

I was talking in terms of UK-wide salaries not just London. IFS data will show you how your salary compares to the rest of the country, and 45k is more than 80% of the population despite it being just over average in London.

London properties are an investment, but if it means we can bring in money from abroad then I don't think it's such a bad thing. You will find this is most major cities around the world.

Completely disagree with this. It’s what makes properties unaffordable for regular people, entire blocks of flats standing empty while people sleep on the streets. I think there should be an outright ban on foreign investment buyers in housing hotspots

It is a market;more buyers than sellers=prices will rise.All due to government policies.

Dodgeballchamp, I know what you meant. I just think it’s useful to relate London prices to London earnings.

I actually have another couple of friends who bought a 2-bed garden flat in outer London. Both earn a fair bit under the London average but enough for a decent flat in a good school catchment. They had tried to move oop North but it turned out their jobs paid the minimum wage and they wouldn’t get any more property there and have less disposable income to boot.

while people sleep on the streets

Right, well people can move to other parts of the UK and take their to invest in places that need it most.

Take their money

Sorry what? People who are homeless can just ‘move to other parts of the UK?’ Is that actually what you meant?

I’m not sure Australia is a sensible option currently. I imagine quite a few U.K. people who went there may be returning.

@malylis

Chase is a max 15 min walk) or by any number of busses.

15 mins walk or bus at that time of the day then hope you haven't just missed a train because it could be another 10 minutes minimum once you get there. You could have a buggy with you and toddlers too. Enfield doesn't have good commuting links. You can get out for a night out. Not so great coming back. As I've said, I've known people who have tried Enfield for cheap rent. It isn't an easy commute in unless trains are perfect.
. The chance of Piccadilly and Victoria being down is remote but even so you have overground. Seriously. Enfield is not good for the commuter who can't be regularly late for work. I know some jobs are okay with a regular five or ten minutes late but a lot aren't.

Australia hasn’t been in a great place financially since 2015. I visited in 2017, Perth was like a ghost town

Enfield is great for transport links.

Oh wow now throwing buggy and toddler into the commute as well as very irregular difficulties on train lines.

See what I mean about throwing up barriers.

You can get home from any night out easily, straight from Liverpool st or change at 7 sisters.

Barriers barriers. More than half of Enfield works centrally.

Keep renting where you can't afford and whinging about it.

Oh and 24/7 on piccadilly on fri and sat

You can't afford to live where you want, like most people in London.

Happy renting!

I hate the automatic application of "whingeing" to try to stifle any vocalisation of discontent. IMO it just makes people look like they cannot cope with another point of view. Re:what an earlier poster took exception to, I stand by my opinion that there are parts of London which are expensive and look awful. Others may think they are wonderful, fine, but I'm allowed to disagree.

malylis

I have posted on this subject time and again and unfortunately a lot of MN aren’t prepared to make any compromises with regard to buying their dream property in their dream location without giving up their lifestyles

I have been told I was lucky to get on the housing ladder and the only reason I was able to buy my first place (cheapest run down grotty studio flat) was because of the year of my birth and not the f/t job + evening and weekend work Dp and I did for a year in order to raise a big enough deposit so out multiples could buy the cheapest thing on the market.

We lived in some of these nice areas of London when they were really really grotty

MN follow the line of you can’t afford to buy in London so you might as well not try.

Any resistance or questioning this as you can see throws up barriers of why it can’t be done

Or the classic post I got earlier in this thread.

oliversmumsarmy a landlord. They always tend to appear on these threads & blame everything but themselves & because they know "poor" people who can do it you can do it too

The irony is that there seems to be some tacit agreement that the people I know on quite low incomes are making it work so the question is why can’t people who have better incomes.

I hate the automatic application of "whingeing" to try to stifle any vocalisation of discontent.

It's exhausting & a race to the bottom.

I am in a home worth about 1.2m, I have never lived in horrible areas, owned or rented. Yes I have "worked hard" but I did literally nothing to make 800k from property apart from a bit of my own interior design/remodelling. I simply was able to get on the ladder at the right time & had parents who could lend me a small deposit & the bank throw a mortgage at me.

Yes gigibanks it's as another pp said - wouldn't it be nice if that wasn't necessary for the next generation? How do we want our society to be in terms of housing, and what tax/other policies can achieve this?

I'll admit, I don't particularly want adult dc to have to live in a dormitory or even an overcrowded hmo for all of their twenties in order to save a deposit - I didn't, and it wouldn't seem like progress if that became necessary for this generation!

Having said that, it is true that for each generation of buyers in london, the bit of london they would have liked was probably out of reach, and they compromised by buying in another, which is then out of reach of the next generation.

You are a GP ( so a higher earner) but aren't willing to have a large mortgage, again you have had made a condition which prevents a move.

The point I was making is that these towns want to attract key workers and other people doing useful jobs, but can't, and a key reason is likely the high cost of housing. So we won't move there, we will choose to move somewhere with cheaper housing, and that is their loss as they can't get the key workers they need. If some high earners are put off moving to an area due to expensive housing, presumably lot of middle and low earning key workers are put off too (except those who qualify for some form of social housing), and that area will lose out.

Big towns have key workers generally, those with significantly lower prices struggle to attract.

Alanis what’s your definition of awful? Crime on the doorstep, shops closing down, derelict buildings , no sense of community? If you were talking about hackney I’d somewhat agree as there is a lot of crime there (I used to live there and it literally was on my doorstep) but even that has a sense of community. It’s well overpriced though. But east Dulwich is literally nothing like that!

oliversmumsarmy I do agree that people need to manage their expectations. A friend of mine was moaning she couldn’t afford to buy so I found loads of flats in her budget and sent them to her, I got nothing but ‘it’s too small and who’d want to live THERE?’ Personally I don’t have an issue with flats or ‘grotty’ areas, as a working class person I actually feel more at home there! But I’m saying all that with the caveat that the property market in London is out of control and it shouldn’t necessitate huge sacrifices detrimental to quality of life just to get somewhere basic to live

@malylis

Not after 12. No good night bus links either. Not everyone gets in by 11. Enfield is fine if you have a car. It isn't good for commute.

I could never buy anywhere. This is all just conversation. I just know the Enfield is not good for commuting from previous experience with friends and colleagues. Southgate isn't even near most of Enfield. The lack of tube and night transport lets it down.