100k+ salary, is it worth it?

[Goingtogetslated]

For the record…Not trying to be insensitive…

partner and I both earn approx 150k each. Working long and unpredictable hours with high levels of stress and responsibility.

Yet here we are living in a 3 bed terrace in the east end of london, a basic car, neither of us into high end expenses/dining out/clothes. We used to holiday a lot pre children, I guess would classify as our major expenditure in the past.

But is it actually worth it? A decent 4/5 bed house (with kerb appeal I admit) in the commuter belt seems to be coming in at 1.5 million minimum. Add the commuting costs/ extended nursery hours, paid help required theres barely anything left - relatively speaking.

Would we not be better off sacking it all in, moving to the countryside and earning enough to pay the bills?

We appear to be stuck in this middle ground where we earn too much to have any allowances from the state, contribute a lot to the government yet not enough for any real benefits in lifestyle

@Mirabai

To clarify, I think the rules implemented by the government unfairly penalize landlords and it has resulted in a shortage of rental properties in all categories.

A legal framework is required but the extra costs above and beyond what homeowners pay just adds unnecessary costs to tenants. Landlords also don’t want the headache so are leaving in droves.

To be clear, I am a landlord and I have no turnover in tenants because my homes kept to a good condition and I don’t increase costs beyond my own increased charges. I share that information with tenants so they understand I’m not being unfair. I think rental contracts should have right to renew as standard with rent increase limited to CPI unless you can prove as a landlord your costs have increased more than the permitted increase of CPI.

Worcester Park, for under £700K. There are plenty of nice areas in Zone 4-5 where you can get a spacious house with a garden and live somewhere safe (for London) and close to green space, for not that much more in transport costs than it would cost to be in zone 2 or 3.

Do you know how much we get for “on call”? 2% extra, if you are on a “high intensity” on call rota. The very busiest, like A&E, get 4%. We get £2800 London weighting” per year as well.

I am an NHS consultant in London, I have been one for five years, I can assure you I earn under £100k, full time, including my high-intensity on call rota, and will not be breaking past £100k for another five years.

I do not think @Goingtogetslated works in health. I got impression corporate? maybe she’ll come back and clarify.
Health got introduced as an example of needing to be in London and accessible in short time

That's exactly what I meant when I said you have to have lived in London, or another major city (I don't know enough about European capitals to comment) to get it.

300K joint would get the OP what she wants in any other UK city. Of course there are mullion dollar mansions in other places, and not everywhere is cheap (looking at you, Cheshire/Alderley Edge) but it's very doable. I've got a 4 bed semi 20 mins drive from Manchester for a bit less than OP's combined household income. In an 'ok' area. In a 'naice' area it would be 600-700K which for her is still doable.

The OP isn't originally from London. She's lived there 5 years she says. It's easy to see why her expectations are skewed if she's moved from a place where what she wants would be within reach. Which is most of the rest of the UK.

Also the British have an obsession with landed property and gardens. Don't know why, the weather is shit most of the time anyway but a lot of people don't consider flats to be 'serious' properties. I wouldn't mind one, where I grew up there's no space for anything else but we also have very tight protections. Management companies here seem to just charge what they like...

@Saschka the ones i know have been doing it plus 10 yrs

Who said there weren’t options? She’s got plenty.

But the idea that a 3 bed terrace in Stoke is “fancy” is bizarre. Chelsea is “fancy”.

I don’t think it’s U to think that on a combined salary of 300k you’d should be able get a nice house in zone 2. And why not? You used to be able to.

Finchley is miles out, clinging on to the fringes of London.

It’s not that OP can’t compromise or that she doesn’t have plenty of options, but you wouldn’t expect on such a high combined salary to have to make those kind of compromises.

This is where the madness of London property prices have brought us.

The payscale tops out at £119k, after 20 years. You then stick on that until retirement. It’s a national consultant contract, there is no capability to be paid “extra” for on call work etc beyond the scope of the contract.

Any NHS consultant making £180k is doing a hell of a lot of private work - it is not all coming from their NHS work, no matter how much “overtime” they are doing.

Where did I say they made 180k? I just said the ones I know made more than 80-110k...

I voted ynbu as I don't think money is worth working all those hours and having all that stress. I would choose to work normal hours and earn less money, live somewhere cheaper and not waste as much money. Don't sell your soul. You have one life and working night and day every day can't be made up for with cash.

I do think you are being unreasonable to mention not getting any government help. Families on £30,000, £40,000, £50,000 don't get any help either. Of course you don't get any help. You've already got substantially more than your fair share of money as it is.

Who says OP won’t compromise on size or area? She’s looking to move out of London… It’s not as if the east end is a particularly nice area.

The fact that to live in London you have to compromise on living space is precisely the point of the OP. The question is whether it’s worth it.

The NY apartment comment is a bit odd given that a. Multimillionaires’ apartments are massive and b. They are many more apartment buildings in NY, it’s like Paris.

And therein lies the rub - 'you used to be able to'.
As a PP posted lots of civil servants owning ordinary terraces in places like Islington. Bought at the turn of the century/in the early noughties. 200-300K.
Now million dollar properties...
Even in those days there were half a million dollar properties but these were clearly the 'nicer' ones, now worth double that. Not the normal houses.
I suppose a 'Victorian terrace' with period features might command a premium but depending on construction not all of them are desirable properties. They can be draughty and difficult to heat, 'charm' and 'character' aside.

I’m not sure of the relevance of your question but via an annual tax return like every self employed person. Expenses don’t really knock anything off my bill as the sort of work I do doesn’t really incur expenses.

Even 20 years ago you could buy a 4 bed house in zone 2 for 200k - and those houses are now 1.2 million+. So buyers need to find an extra million for the same house!

This is the kind of spoiled, entitled attitude I'm referring to.

Finchley is hardly 'miles out' for crying out loud. East Finchley is Zone 3 and a nice area, with lovely houses for under £800K. Northern line on your doorstep, an 18-minute journey to Tottenham Court Road, even less to Euston. I lived there for years, and it's a very well connected, decent place to live. Fringes of London....Good God. There are NINE travel zones in London. Finchley is in zones 3 and 4. Fringes of London is Watford or West Drayton, not Finchley.

Who cares what you used to be able to do years ago? How is that relevant? House prices have been outstripping wages for decades now and the population of London keeps ballooning. It simply isn't realistic to expect to be able to live in one of the inner zones AND have a big house AND have loads of money left over for other things. Why don't you go and see what £300K gets you in NYC or Hong Kong? Why do you think London somehow has endless space for all these people to live in?

Living in Chelsea hasn't been possible for anyone except oligarchs or people with inherited wealth for years now, so I'm not sure why you're even talking about it.

Affordability of houses to average wages has dropped across the country.

The reality is that what someone now in their early 50s could afford when they had children in their early 30s is wildly different to what their equivalents 10 years younger or 20 years younger could/can afford.

The OP thinks because she's on a very high salary she should be able to avoid this decline because in some way she's super special and entitled to x, y and z.

It's most pronounced in London but it's not restricted to London by any means.

https://www.ons.gov.uk/peoplepopulationandcommunity/housing/bulletins/housingaffordabilityinenglandandwales/2021

This has been driven by internal migration patterns (people moving to cities in particular) and away from provisional towns due to lack of jobs and opportunities. As well as people living longer, living in small family units and immigration. And compounded with wage stagnation, low interest rates favouring property as an investment and increasing inflation on fuel and food. It's not even an issue with lack of housebuilding in some areas too - there isn't the land to do it without knocking down and building up - and you aren't going to magic up a new lot of Victorian semis with that. They are a finite resource with more and more people chasing them.

Basically the standard of living has dropped and we are seeing greater centralisation. Everyone is having to make different decisions to those slightly older than them. I know that the close friends I have who are 10 years older than us wouldnt be able to afford the homes they have now if they were on the same career path ten years ago. You can't do it without inheritance or another type of winfall.

So expectations need to adjust accordingly.

There is no obvious solution to this if you want the opportunities from living in London.

The alternative is to move to places where there isn't the demand - the provincial towns which are dying on their arses cos no one wants to live in them. But arguably you can change the quality of your life for the better if you have the capital. Given that you could buy a nice house in parts of the north outright for just a couple of years working in London on £150k that's significant. Lots of people are doing just that and driving up property prices outside the capital to levels that are forcing up house prices elsewhere.

For me it becomes about swings and roundabouts. You have to compromise on something somewhere.

I don't believe our quality of life should have dropped as a nation but I do think the public and politicians have made some incredibly poor decisions over the last thirty years in terms of investment and infrastructure. Brexit alone was projected to increase costs 20% before we left the EU and tbh that's not looking wildly off the mark. We can't really blame anyone but ourselves.

The point is that people in NYC accept that living in a city means compromising on space and gardens. Not sure what's odd about it. Not just multimillionaires, but people earning the equivalent of 300K are all living in flats with children or way out in the suburbs of the Bronx, Queens, etc. OP could buy a nice flat in a nice bit of London...she just doesn't want to.

The question of whether it's worth it is up to OP. I certainly wouldn't think it was worth it to take a huge salary cut and decrease my options rather than making do with a smaller living space, but that's me. I'm not sure why OP seems so surprised that living in a major capital city is expensive.

Oh sorry, different poster said £110-180k.

Is there a reason you’re being so aggressive? I’m not entitled I’m just old. I’ve lived through exponential property price rises in this city and I totally understand the dismay at what property even high salaries can afford in 2023, particularly from people moving in. The fact that NY and HK are similar is irrelevant - that’s why many people choose not to live in those cities!

And please don’t lecture me on fucking Finchley it’s where my dad is from, I know it well. E. Finchley is nice, it borders Muswell Hill. But N.Finchley is almost the country lulz.

It’s very odd that you demand everyone accept the super-inflation of house prices compared to income without comment.

Having worked in NYC for years, I lived in Jersey because the commute was great (15mins to midtown at 5am) and my ex husband paid substantially less in taxes.

A 3 bed apartment in Manhattan is about $8000 a month and about $6500-7000 in Jersey or Brooklyn. The difference between the UK and NYC/Jersey is that rent control rules for homes ‘built’ before approx 1980 limits the increase in rent to CPI and tenants have the right to renew without having to sign a new contract each year. This gives tenants the ability to have stability.

It looks like you need to be careful with lifestyle creep. I absolutely disagree that the only types of houses you can be happy in with your income have to cost £1.3m to £1.5m. Frankly that’s ridiculous and not true.

£1.5m is 5 times your £300k household income so that is seriously stretching yourselves and increases the risk of keeping up if anything happens eg one of you loses your job.

To me you need to lower your expectations, buy somewhere more reasonable that gives you more disposal income to save for your future and also enjoy experiences and things with your family rather than getting house poor with this unrealistic expectation that you need to be in a £1.5m house to be happy or fulfilled.

While we now live in a Chicago in the US, our household income with salaries, bonus and stock awards etc is about the $400k mark and our mortgage is about 1.5 times our salaries alone excluding bonus and stock awards, and this and even if one of us loses our jobs we can pay our bills with just one income.

Now I know houses in London are more expensive than Chicago so aiming for 1.5 times income is maybe not realistic but please don’t stretch yourself to 5 times your income unless you’re bringing a significant deposit to lower your debt to income ratio.

I guarantee you even if you get the £1.5m house there will still things you can’t afford and feel FOMO about.

There always someone richer than you except I guess you’re Elon Musk, oops he’s now second richest lol anyway funny way to say be content with what you have.

What’s odd is to imply multimillionaires in NY live in apartments because “you can't expect the same kind of living space you'd have elsewhere” rather than because apartments make up a large proportion of the city’s housing stock!

OP could buy a big flat in London if she wanted to, but she seems to want a house with a garden - and you know what? It’s perfectly ok to want to live in a house with a garden, have a dog, etc all kinds of lifestyle choices you don’t understand and get angry about.

Hmmm nyc apartments are often huge and bigger than a house. $3m in Queens buys you a lot of sqft. I know the Jersey market well and $3m buys you 2500-3500sqft depending on number of parking spots, amenities and property taxes.

Wages in the US are much higher for the upper middle class compared to the UK. My experience has been that management work a lot harder and are generally speaking a lot better trained compared to the UK so their output is significantly better in comparison.

Even 20 years ago you could buy a 4 bed house in zone 2 for 200k - and those houses are now 1.2 million+. So buyers need to find an extra million for the same house!

That was 2003 - I bought my little 2 bed semi in a normal little town 1.5hrs outside of London for 95k that year, and next door, who bought there's 6 months later, paid another 20k. The 3.5 story, 4 bed townhouse I shared in Fulham was worth more than 500k before I moved out of London.

Perhaps you mean 40 years ago?

Or perhaps I don’t mean Fulham?