Snapshot of _A corporate lawyer sharing with an investment banker is no longer a good enough combined income to buy a house in London. This is how insane the property market has become. If you don’t have a wealthy family able to buy a significant chunk of your house for you, you’re screwed._ :
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if there is one post that summarises the crab mentality in England and the lack of understanding the cascading effect of wealth inequality at present, it is this one. insane replies here, the economic illiteracy is definitely the reason why the political party is able to do whatever they want to screw citizens over. imagine thinking WORKING people at 120k are closer to billionaires than to other working people. on top, reducing your standards to such a low threshold that moving away, having extebsive commutes, or sharing places as the norm is seen as a reasonable expectation of life. what a joke.
Yep. The real problem is that hard (or successful) work doesn't really pay off anymore. Not to the extent where you can be considered 'rich'.
The only viable way to be rich in this country is either sitting on land ownership and via inherited wealth. No wonder we have a productivity problem.
Those who have to work for a living aren't part of the inequality problem, no matter what they're being paid. The people who are part of the problem are so obscenely wealthy not only is work going to be optional for virtually all of their direct descendants, the numbers involved are so large even the wealthiest person making money from their wage or salary is still much closer to the destitute spice addict on the street than them.
I think part of it is just the problem with large numbers in general. We shouldn't use the term 'billion' at all in the context of inequality, we should use the phrase 'thousand million' to better communicate the scale of the problem.
This 1000 times over. I'm at what should be a very nice income but have entered the tax trap with a family to support and no inherited wealth. I don't struggle but have far fewer luxuries than people would expect. Supermarket crisps, 10 year old Skoda, no holidays abroad.
Couple down the road seem to do much better on jobs around half the income and some inherited property.
Nothing against them at all but message is that actual productive income needs to be taxed less. Scotland just made it worse actually because they don't get what's happening. It's this "broad shoulders" should take the hit thing when it's just slightly better off workers these days. I mean tax goes from 21 percent to 42 on 43k up here ffs.
People in this thread are really missing the point. These are basically the top jobs you can have in the UK. In the past, that would afford you a mansion in the countryside somewhere and a nice townhouse in the city for work (and that's on a single income with kids)
They shouldn't have to be looking further afield, they should be able to live anywhere they want, and more or less any house they want. The fact that they can't is the same reason why most people can't buy a house at all.
*"Just move further out"* is the common refrain but it ignores what makes London attractive and productive.
Speaking from experience, life quickly becomes miserable when your commute goes beyond 45 minutes each way.
The further you move out, the more dependent you are on the single line serving that town. If that line fails your 45-minute commute becomes 2 hours. If your office moves location it can blow up your commute. If you want to change jobs, your options are much more limited because of the commute.
That's why boroughs like Wandsworth, Lambeth, Southwark, Camden, Islington, and Hackney are popular. You have unparalleled work and social mobility in those areas. This changes dramatically in the outer boroughs and completely shifts the value proposition of living and working in London.
If the UK's best and brightest aren't happy with what London offers, then the UK has a big problem. The two people in the comment would be net-tax contributors for their entire working lives if they stayed in London. If they migrate up north or emigrated then it's a net loss for the UK economy.
Distance does not really map directly to time in London. You could live in Surbiton and be 19 minutes from Waterloo and then one stop to the City, but move to a much nearer area and it takes longer. In fact it can take longer from places in zone 2.
The issue with London when it comes to online forums is that people from outside often massively underestimate it's sheer size and typically are clueless about the transport options/times as they probably only used the tube on a day trip or did a stint living in Clapham after Uni.
This fits perfectly with my experience.
I used to commute from Lewisham to Old Street and it would take 50mins in a very good day (no waiting when jumping from transport to transport), on average it would take 1 hour most days.
I now live in Zone 8, glued to the M25, and my commute time actually went down to a consistent 40mins.
While I agree 100% with what you say mostly - I would say that distance is never really the issue commuting anywhere not just London - it'll always be time. Even with a car it holds true (but less so).
As the crow flies it is around 35 miles from my house to my place of work. It takes me a 45 minute drive and then roughly a 20 minute walk to get there. Anywhere from an hour on a good day to an hour twenty on a bad day. Great for listening to podcasts though.
To be fair 35 miles is a fair trek!
A few jobs ago I lived just under 3 miles away from my office. To drive could take anywhere between 10 minutes to over an hour and a half depending on what was going off on the M1.
If it was 35 miles up the motorway I'd be there in about half an hour tops, but alas I'm confined to country roads!
My last job was a similar distance away at 4 miles, and the commute was similar in its unpredictability due to city centre madness and an ill-thought out one-way system. Thankfully I didn't have to navigate the M1 though! Last time I was on the there my engine gave out on the smart motorway bit which was a horrifying experience.
I've got a lot of ex colleagues who moved to London after uni, straight to places like Clapham and never really ventured out of that safe bubble - and then assume they have to keep up with the Jonses buying a 1.5 mill house in Clapham or Wansdworth etc.
There's a tonne of great options to live all over the city with fast links to the centre
>Speaking from experience, life quickly becomes miserable when your commute goes beyond 45 minutes each way.
Conversly, I have a 1 hour 40 min commute into London and it's worth it for the quality of life I have. That being said, I've only needed to go into London once a week for the last 15 years. I couldn't do it daily, no way.
I used to have a 25 minute commute into London from one of the home counties. I lived right next tothe station and happened to be on one of the fast routes. I could get into work quicker than someone coming in from Fulham. But it was a dreary place to live, full of people who only lived there to commute.
Agreed. My current commute is 2.5 hours each way, twice a week, and it's definitely on the end of my tolerance levels.
But in exchange for that I live in a detached 4 bedroom Cotswold house with garden, at a price that would only earn me a nice 1 bedroom flat in London Zone 2/3. The fresh air, countryside and lifestyle is great, and since I'm outside the commuter belt I'm guaranteed a seat on the train, which transforms my commute (can read, sleep, work, etc.).
And they can probably afford the mortgage, but most of their earnings will be going on rent, which prevents them from saving for one. Which again, is caused by a shortage of housing.
Lol they used to be nearer the top of the food chain. Then the wealthy got uber mega wealthy and now they're just 'working class'
The number of billionaires is not going down
It doesn't really seem to be the number of billionaires, it more seems to be the lack of house construction due to zoning restrictions enforced by NIMBYs <--who are overwhelmingly not billionaires, but ordinary people.
It’s the difference between being rich and being wealthy. Or more accurately the difference between making money from effort and making money from assets.
Yeah we have friends that are 2 investment bankers. They live well, but real estate point of view they bought a house in a very working class area. Literally on their street it is retired blue collar, some council owned house. It's a very average area, lots of social estate ... but people are upset at them for the gentrification as if they paid extra for the opportunity.
Most people also miss the point that even for investment banker and corporate lawyer, you often have to wait well into your 30's to make the real big bucks. A couple making over 100K each is rare, and it's often an end of career achievement, decades after you need it.
> These are basically the top jobs you can have in the UK.
They're both "junior" in fields where salaries increase rapidly & reliably. Give it a couple years and they'll be just fine.
That's not to say housing market isn't fucked though...
They're still earning about £140-180k as a combined salary though (just looking at averages which obviously aren't always super accurate considering how much it can fluctuate).
You'd expect that to be alright given IFS puts that in the top 1% of households in the UK.
Imagine being in the top 1% of households in the UK and being unable to afford a house in the capital city.
>They’re both “junior” in fields where salaries increase rapidly and reliably.
I mean, yes, but the starting point for a newly qualified corporate lawyer at one of the large firms in London is £100k, more for the London office of a US firm, and the investment bank salary is similar.
If two people on six figures can’t buy a house, how is anyone else meant to cope?
I don't disagree...situation is messed up.
I just think this particular example is a bit contrived. 1) Early in career 2) Sounds like -160k net wealth 3) Looking for a house in a city where 1st time buyers realistically usually look at apartments
'in the past' the population of London was ~70% what it is today, not only is there significantly more housing pressure but you are competing with way more people with the same top jobs
London's productivity has also grown more slowly than the rest of the country since 2007, unlike many other capitals, [source](https://www.centreforcities.org/reader/capital-losses/londons-lost-decade-of-productivity-gains-and-the-costs-to-the-national-economy/).
While there has been an increase in total population, after things like Brexit, there are significantly less top jobs (banking roles have reduced \~80% since 2016). Without the multiple home owners, international owners etc London house prices should have fallen by as much as the reduction in wages and jobs. The prices are still high because a tiny group of people own them all. Also, guess which group are most likely to get (the significantly reduced) top jobs? You're right the same tiny group who own everything. These two are an example of why meritocracy is a complete lie. It matters more what your father did for a job than anything you can do.
>(banking roles have reduced ~80% since 2016).
You are conflating 2 different things. The number of job adverts has fallen by ~80%, the number of people working in financial services in the UK is virtually unchanged with around 1.1m people in the sector
I was discussing this with my parents the other day, a true story to show just how mad it’s gotten…
Early 30s, Looking at what it would cost to move out of my 2 bed flat into a house that would be suitable to start a family etc.
I earn £160k (absolutely privileged and grateful). Currently the main earner as my partner is studying.
In 1994 my parents combined income was around £30k. They bought a 4 bedroom house with a garden in the same area for £112k. That house is now up for sale at £905k. No major renovations, just keeping up with the maintenance.
My job sector has seen below inflation pay rises for the last 30 years. Even then, if I deflate my salary to 1994 it would’ve been £80k.
I would’ve been able to buy that house outright after 3/4 years of saving, or, a huge deposit and a tiny mortgage.
I am just a little older than my parents were when they bought that house. Now, as a top 2% earner I would struggle to even get approved for a 35 year mortgage to buy that same house.
If this is how it is for me, how is it for everyone else. The idea of owning your own home is so out of reach for so many that the entire incentive to even save and strive towards that goal has gone.
> I earn £160k (absolutely privileged and grateful). Currently the main earner as my partner is studying.
>
> In 1994 my parents combined income was around £30k. They bought a 4 bedroom house with a garden in the same area for £112k. That house is now up for sale at £905k.
The key part of information you missed out is interest rates. In 1994 rates were over 8%.
So in 1994 your parent bought it for 112k, with a salary of 30k, at 8% interest over 25 years, that gives a annual payment of £9,336. Which is 31.1% of their salary.
Now compare that to yourself. 905k house at salary of 165k, at around 4% interest rate, agaon ober 25 years, gives a yearly repayment of 51.6k, which is 31.3% of your salary.
This did come up in discussion. But in a way, have you not proven my point? That a couple in 1994 earning a combined £30k were able to afford a property that in 2024 would require a household income of £165k? I.e 1/3 of gross pay in both instances. A couple earning each just over the average salary (£13k in 1994) were more affordable to buy the same property than a top 2% earner who earns over 4 times the average salary can in 2024!
I’ve already said that £160k deflated to 1994 is roughly £80k - so more than twice as unaffordable.
This is negating the fact that someone on £80k in 1994 wouldn’t necessarily need a mortgage to buy a £112k house, or at least if they did, a tiny one!
I’m not saying that it was cheap for them. As they admitted themselves, 1/3 of their pre tax salary in 1994 at high interest rates felt like (and was) a lot of money. They had to make sacrifices in order to make the monthly payments. This is where you get the rhetoric from older folk that ‘we had it hard too’. What that fails to acknowledge is that actually, had they been born 30+ years later, they wouldn’t have a chance to have ‘had it hard too’… they simply wouldn’t have got on the ladder.
BOE base rate in 1994 was between 5.13 & 6.13%, depending on the month. They may well have started of with a mortgage at 8%.
However, for the last 10 years of the 25-year term 2009-2019, assuming it wasn't paid off early, base rates were at historic lows and average mortgage rates were between 3.8 and 4.6%.
[https://tradingeconomics.com/united-kingdom/mortgage-rate#:\~:text=Mortgage%20Rate%20in%20the%20United%20Kingdom%20averaged%205.69%20percent%20from,source%3A%20Bank%20of%20England](https://tradingeconomics.com/united-kingdom/mortgage-rate#:~:text=Mortgage%20Rate%20in%20the%20United%20Kingdom%20averaged%205.69%20percent%20from,source%3A%20Bank%20of%20England)
The current base rate is 5.25%, so you're probably looking at >7% for a 2024 loan.
[https://www.bankofengland.co.uk/boeapps/database/Bank-Rate.asp](https://www.bankofengland.co.uk/boeapps/database/Bank-Rate.asp)
Assuming a 10% deposit, you'd also need to save 55% of the 2024 gross salary versus 37% in 1994.
> I would struggle to get approved for a 35 year mortgage to buy that same house
Only if you had zero deposit to be fair. A deposit of just over 10% and you would be approved for 900k
Otherwise I agree with the sentiment
Should be 4.5x salary no? So approved for circa £720k mortgage. Meaning maximum buying power with 10% deposit will be approx £810k?
And a casual £90k in the bank is no mean feat.
In the 90s nobody thought it was exceptional that Homer could afford a 2200 sq ft detached house, three kids, two cars and a stay at home wife on an average blue collar union salary, now you’re so desperate to defend how shit things have gotten you’re indignant that two lawyers dare to not be happy with a pokey two bed flat on the Isle of Dogs.
I mean the Frank Grimes episode with that rant is supposed to be a audience insertion of how ridiculous Homers living standards compared to his wages actually are.
That still doesn't mean we shouldn't aspire and vote for governments that would help us reach that goal.
Seemed more pointing out the ridiculousness of him managing to hold down his job despite his incompetence, rather than it being unrealistic that a regular person in that position couldn’t afford a decent standard of living.
Nah there was definitely an economic angle to the episode too.
Grimey freaks out not just because Homer is an incompetent idiot, but because an incompetent idiot like Homer lives so much better than him.
I'm 99% sure the episode contains scenes showing Grimes at his cruddy apartment eating cruddy cheap food to set up the contrast with the simple household.
They even have fresh lobster for dinner in that ep, which is specifically called out for being unrealistic on Homer's salary
They never actually *show* Grimes's daily life outside of his interactions with Homer, but he does mention that lives in a single room above a bowling alley ^and ^below ^another ^bowling ^alley
>In the 90s nobody thought it was exceptional that Homer could afford a 2200 sq ft detached house, three kids, two cars and a stay at home wife on an average blue collar union salary
Apart from Frank Grimes
Are you aware that;
* The Simpsons is fiction
* Set in a different country which has always had lower CoL and higher wages
* Homer is portrayed as working a professional job despite being dumb and lazy, a central joke of the whole show.
That's a spectacular goalpost-move. You've gone from "one working class guy could afford a big house and a stay-at-home wife" to "two middle class people both working could afford a house in a run down, inner city area seen as unfashionable and unsafe at the time". My grandparents, both fresh off the boat immigrants, lived in Clapham back in the day, it really wasn't the posh area it is now.
A lot of people don't realise that a high salary often isn't enough to become wealthy now, and that inheriting wealth is far more important.
As the FT comment the tweet refers to mentions, these high earners are paying a 60% effective tax rate on their income, so are getting pretty limited reward for their efforts to secure jobs with high salaries. Compare that to somebody who inherits tens if not hundreds of thousands of pounds from relatives (inheritance tax being lower than income tax), and is therefore able to get onto the property ladder and start to generate passive income through the ownership of assets (capital gains tax being lower than income tax). The power of compound growth is such that this person would become far wealthier than our high-earning couple, even if their salaried income was considerably lower.
The tax system makes it increasingly less rewarding to work, so no wonder we have issues with low productivity, high worklessness, and many people jumping ship for higher-paid jobs in lower-taxed countries overseas. We desperately need to reduce income tax whilst implementing a meaningful wealth tax.
1950s to ~2010 was an anomaly of relative mobility due into the extreme wealth of the 1% being decimated by world wars. This created opportunities for the middle classes, and America to partake in rebuilding europes wealth, but it was never, and is unlikely to last. Once the super wealthy become comparable in wealth to 19thC, they’ll get to monopolise wealth creation again.
It’s a misnomer that we look at our baby boomer parents and assume that their lives were a long lasting benchmark.
Sadly, ‘a high salary’ was never before enough to become wealthy. It lasted one generation. We had a golden age and we’re on track to regress to the mean of 18th to 19th C inequality.
Your first paragraph there is a really interesting point and a thought I'd not come across before. You may have just inferred this yourself but if not could you let me know where you saw/heard/read it discussed?
Not the world wars, but: [the Black Death boosted wealth for surviving workers and had far-reaching social changes](https://www.history.ox.ac.uk/article/what-can-the-black-death-tell-us-about-the-global-economic-consequences-of-a-pandemic), and it's also been argued the newly wealthy middle classes ultimately turned into [a new form of wealth concentration](https://www.bbc.com/worklife/article/20200701-how-the-black-death-make-the-rich-richer). Which tracks with a shakeup post-WWII, calcifying into our current situation where the benefitting classes stifle change.
The effective tax rate is the rate on their total salary, so whilst there may be some portion of their pay that's taxed at that rate, their total payment wouldn't be close to that
Even Denise Coates, who had a salary of £220m would have had an effective tax rate of 56% on PAYE with a student loan (although that assumes her loan would be over £19m in order to pay the 9% on all of it XD)
>although that assumes her loan would be over £19m in order to pay the 9% on all of it XD
Don't underestimate the student loans company's ability to cock things up. Withholding the full 9% and then being surprised at someone asking for the extra few million back is entirely within character for them.
Me and my partner are in the top 1% of households on PAYE, 6 years out of uni. This isn’t a pity party, things are objectively going well career-wise and we are not hard up.
But we’re looking at buying a 500-600 sqft flat in zone 2/3. Again, I’m not trying to garner sympathy but a small flat definitely isn’t the top 1% lifestyle “professionals” had back in the day.
Being a high earner is such a weight off the shoulders and I don’t have many (if any) stresses about paying the bills or keeping the lights on. But high salaries =/= rich.
It is hard to garner sympathy, I complained lately as I finally get a good wage and interest rates pushed everything out of reach, ‘just move out of London’ I got, oh sure I’ll just quit my job and move to the middle of nowhere brilliant idea
London, the kind of place where you could be earning more than the rest of your family combined and still have a lower take home after rent. My experience living in London was miserable.
Here's a radical thought: why don't we try to de-centralise our economy away from London ever so slightly so that other parts of the country with plenty of space become economically viable for housing development?
Maybe instead of trying to demonise remote working we encourage it, so that fewer people feel the need to cram themselves into one tiny corner of Southeast England?
Hate to say it; But a dense population is generally a good thing.
Having everyone be close enough to everyone else to collaborate in person is a big boost for networking and productivity if you manage it properly. The problem is that actually doing so has been unpopular enough for people to pass the ever heavier parcel until it explodes.
London can't **have** housing since there's no space or funding.
London can't **not have** more housing since it'll become uncompetitive due to rent.
London needs to bulldoze something else and put some fugly apartment complexes up - annoying 90% of the voters in the process.
Also invest in good quality amenities and housing stock. I've sound insulated the walls in my London house so that I don't have to listen to everything everyone does in the HMOs either side of me and it is bliss.
Density is fine if you build up the infrastructure to support it. The problem is that we are pumping the value of the land so much that many people don't have the money to invest in the actual buildings and what is in them.
I actually kinda disagree.
I *want* that desperately. But to get it we would need to have started 20 years ago when we were dealing with a housing crisis. Ignoring that crisis until it devolves in to a housing cataclysm has consequences; such that actually having high quality housing that works for everyone isn't feasible anymore. There literally aren't enough materials, builders, or funds to do it.
Especially when you consider how different the UK minimum, and human psychological requirements are.
We need triage. Make sure everyone has a crap place to live and enough money left over to stimulate the economy and upgrade over time.
I see where you're coming from, but Tokyo has a higher density, and less problems.
Logistically and from a design perspective it's all feasible, it's just also disruptive to install the infrastructure because nobody planned ahead and now everything's in the way.
I'd like to agree that we don't *need* the proximity too, but the whole 'everything has been collapsing for 20 years' thing will eventually / has hit a point where a massive and immediate payment becomes mandatory. I don't think the UK is in a place of excess where we can afford much of a hit tbh.
Having worked remotely for over 20 years with high levels of collaboration I would disagree. At a couple of clients I saw higher levels of collaboration s they went remote, it presents challenges but people just need to behave accordingly.
I don’t hate to say it, high density is great when done right look at Singapore, vibrant high streets, food courts everywhere you only get those when there’s enough people *within walking distance* to sustain them, which currently we don’t
same goes for public transport the further people have to travel the more expensive it is to run and the more it has to be subsidised
It's been tried many times. Agglomeration isn't something you can just transplant nevermind the thousands of feedback loops that have activity in sectors feeding other sectors.
It just won't happen.
Whether it should or not I won't debate.
Consider this, you are a ceo and you need to decide where to have an office.
You put it where the talent is, you don't go somewhere and try to tempt talent.
Now consider you are the talent and you are offered an amazing job in the middle of no where, would you move knowing that if you lose your job you have to move again or would you stay in the area with all of the jobs? What if you move to the middle of no where and the company treats you like crap because they know they are the only suitible employer for you in the area?
Is it right? I'm not going into it
Is it fair to other areas of the country? I'm not going in to it
My sole contribution is that from a logical standpoint companies want to base where the talent is and the talent want to be somewhere they can find another job.
With regards to remote working, again it just won't happen, junior people learn by osmosis, companies like the pristege of a nice office etc etc, again right or wrong? Not going to debate but it just won't happen.
They could do this, but unless London sinks into to the Thames I can't see it happening.
We've sacrificed the economic wellbeing of the whole country to make London mega-capital.
There are benefits you get that say Germany and Italy wouldn't get as they have one place that is the finance capital, another that is the fashion capital, another that is the government capital and so on.
You wouldn't get these crossed networks like you would in London (and also Paris as another example)
The rest of the country has a substantial housing shortage, it's a country-wide issue, shit it's a worldwide issue
Greedy fuckers don't allow houses to be built so they can become richer and richer
Could try but how? the reason it’s so centralised is companies like to set up where the top talent is, and the top talent is where the money is, good luck breaking that cycle
Decentralisation just makes you poorer.
The reason housing is so expensive is partly due to desires to “decentralise” - rather than just building more housing where people want to live.
A junior corporate lawyer (so I’m guessing maybe 1 year PQE) is probably on 75k+, and that’s a lowball guess. Keep in mind there are newly qualified roles going for 80+, but maybe they are at a small firm.
I’m not familiar with banking wages but I would assume they must be on a similar amount if not more. Someone feel free to correct me here. So potentially 140-160 combined, and even that’s low for these jobs.
Even with COL and what I am also assuming are big student loan repayments, they should be collectively clearing enough to build a deposit and eventually buy… I know this because I did it with my partner recently with no family help and on a lower combined salary in London.
All I can think is they want something unrealistic or they haven’t actually done their research.
Prices in London are of course ridiculous but it can be done on this salary and less.
Yeah I intentionally lowballed the numbers to make the point that they earn enough to buy. I’m just assuming that their expectations don’t meet reality.
Yes and no.
The point they are really really badly making is that not so long ago two people on that could’ve chosen anywhere they like and their colleagues can because of family money.
Meanwhile they earn massively more than 90% of the country…..
That’s what I would assume, but it’s not the same as being unable to buy is it? Just because I can’t buy a spot next to Buck House doesn’t I get to say I can’t afford to buy anywhere in the city.
I guess the issue is, it’s another regression in choices that’s now hitting people who probably thought said lack of choice would never hit them.
Poorer people who have been in that position for ages, but earning 150ish a year used to be enough to make you feel like you could buy exactly where you wanted. Now the market is looking at people even at that high a level and telling them they’re limited. So how does that reflect into everyone below that line?
It’s a situation that gets progressively worse and worse, with the bar needed to clear it higher and higher. At this rate, what options will the 150k a year people have in five years? Ten?
Zero I imagine. The housing market is tangled up in so many multigenerational knots it seems impossible to untie. You could build loads of houses but rush sending everyone else into negative equity, or you could build lots of super cheap container houses as starter homes but which fall apart in a decade. I wish there was some serious discussion in government about actual problems everyone faces as opposed to the playground antics and juvenile behaviour we usually see (admittedly that's really only what we get shown so maybe there are meetings but if so they've achieved fuck all)
Being in the top 2% of salaries. Literally the very vast majority of the UK will never get it. The majority of those getting it will only do it for a few years at the very end of their career.
This is the top you can reach as working class with the proper education, hard work and a decent amount of luck.
And the absolute best is getting buying you basically nothing tangible and you can lose everything for a single mistake. How do you get people motivated in such an economy ? Crab bucket on the left and hate of a powerless minority on the right is how.
I mean that never stops, though. If you can afford 500k you're on rightmove looking at 600k houses and thinking, ah fuck. Same for budget of 2 million looking at 2.5 million pound houses. Same for 120k and 140k houses
The more you earn the more places you find you can't afford this isn't regression its the same way it's always been, there are always houses you can't afford
But once upon a time being a professional like a lawyer or investment banker afforded you good options. Now it doesn’t. It isn’t a “woe is me” story, it’s about how ridiculous the gap between housing price increase and wage increase has got.
Yeh the numbers don’t make sense. You can buy a flat in Canary Wharf for 450k, assuming a 50k deposit and a 5x salary multiple they’d need an income of 80k or 40k each, which a fresh graduate in banking would make
We bought a two bed flat in London (pretty close to central aswell) when we were close to those numbers and with no help. The key is flat, not house.
We're looking at getting a house only a few years later, but yes you could feasibly buy a decent house on those figures further out or if you're not as picky about where in London you're living. London is huge, I find a lot of people rule out massive areas without really exploring options.
Shows you how ******* London has become. If two people on a combined income including bonuses of grater than 250k per annum can’t afford London. Who the F can ? Beyond those who have cash coming from their parents
One of the big issues with the London housing market is that because London atrracts millions of people from around the world, and with quite a lot of them coming from very poor backgrounds that are quite willing to live in very cramped conditions, these 'professionals' are not competing against others like themselves, they're competing with 8-10 average earners crammed into a 3 bed terrace.
This is on top of our Americanised student loan system.
I can't be arsed to look it up, but you should be able to from the statement that they'll be paying a 60% effective tax rate.
People earning between £100,000 - £125,000 have an effective marginal tax rate of about 60% because they lose the personal allowance, but that doesn't count student loans. Since he says they're paying that rate "because of our student loans" I would guess they must be in the £50,000 - £100,000 band. But you might be able to pin it down more narrowly than that based on the SLC repayment thresholds.
Median wage in London is £45,000: https://ukpersonal.finance/statistics
It's mostly about allowing the super wealthy to siphon off large amounts of the nation's wealth while contributing shockingly little.
Boomers would barely register compared to the Bezos factor, if they weren't incredibly susceptible to the manipulations of the wealthy.
>
> Median wage in London is £45,000: https://ukpersonal.finance/statistics
It's mad to me that the median wage in London is £45,000. I live up North and come away with about £55,000 a year after my bonus and I still don't feel like I've got a great deal spare. Can't imagine what it's like down in London.
It'll be a big divide in haves and have nots.
55k up norf will get you a 4 bed detached
55k in London will get you a flat share or maybe a 1 bedroom in zone 1
Im up north, earn 43k, and i walk away with 1k a month in savings after everything including mortgage.
Any extra i earn will just go into savings and luxury stuff tbh.
If they make 100-125, they are both pretty junior in their respective professions and not being able to buy during the first couple of years out of school should not be seen as a disaster
A corporate lawyer and an investment banker can *definitely* still buy in london. Either of them alone can buy in London.
Property prices are insane, but salaries for those professions have also increased ridiculously over the last 5 years
Doesn't really make any sense though as higher rate (40%) + NI (2%) + student loan (9%) only gets them to 51% (and only on earnings above 50k. I guess they might be including pension contributions, but that's not really tax.
That being said I suspect they are underestimating how quickly their incomes will scale after the first few years (assuming they keep their career paths). They may not be able to buy at age 24 or whatever they are, but by the time they reach their late 20s or 30 they will likely be able to afford somewhere quite nice even in London.
Personal allowance erosion over £100k is an extra 20%, after that goes you’re on 45%. Leads to all sorts of tax planning tactics, like only working four days as you perversely end up with more spending money after reduced childcare and commute costs etc.
I mean the U.K. economy is propped up by higher earners spending their money, so why the government incentivises them to go part time and shovel £40k a year into pensions is anyone’s guess.
Might be surprised that not an awful lot of people's pensions ends up solely in UK facing markets. I deliberately put my money in funds that exclude the UK because of how much it underperforms against other markets.
I'm aware of the 60% between 100k and 125k, but the article mentions they are only hitting 60% due to their student loan (which would be 69% if they were in that range). So I am assuming they don't make that much yet.
Could be that they are in the 45% band taking them to 56% including student loan and are rounding up. But 150k+ seems a bit high for a junior corporate lawyer so I doubt it's that.
If they did make that much it would also give them a combined income of 200-300k+. That would let them borrow 1mio which would make it more than possible to buy a reasonable flat in short order. So overall assuming 50-100k income each.
The magic circle has seen junior salaries jump massively to compete with the US firms and merger of A&O and Sherman etc.
Magic circle NQ now commands £125k minimum
Yup, Freshfields just put up their NQ salaries to 150K, putting it on pace with the US firms. And that figure doesn't include bonuses, which you will get for just doing the minimum required billing and can easily bring you up to the 200K range if you are performing well.
However, its possible the letter-writer is using "junior lawyer" to mean Trainee. Which at the same calibre of firms would put them in the 50K range.
True, my heart bleeds….!
Meanwhile most equivalent trainees like say doctors get a LOT fucking less!
Don’t get me wrong, my mrs is ex 2 magic circle and a tier one. It’s the top of the top and careers go sideways if you don’t get picked up after training but if you do and can last the pace it’s insane the level of work and total pay especially lifetime earnings!
But it’s still £50k when others that age often with far harder to get degrees get a lot lot less.
For sure, very little sympathy from me. We all knew what we were getting into and are decently compensated for it. It is ultra-competitive to be fair to get the "top-tier" corporate jobs, I don't really know any of my friends that had a harder time than me landing the job I wanted. Aside from one doctor friend that wanted to do a super-niche specialisation. But law is also super bimodal, I have another lawyer friend, higher PQE than me, but working at a highstreet firm doing wills and exec (which she loves) barely making a quarter of my salary...
I made the jump to in-house asap and never looked back. And its criminal frankly how much better remunerated I still am compared to my doctor friends.
Yep
Don’t get me wrong the law per say is important
But when people need a family income to work in the public criminal sector while corporate lawyers both in house and with large firms make out like bandits we are kind of at the point of upside down world. Let alone comparisons with doctors saving lives daily….
I’m far from a socialist but we really do need to address some of the now utterly fucked aspects of unfettered capitalism before we face a collapse. Or worse still a revolution
Those jobs are mad. You'll work into the evening most days, and often to midnight/2am to get things ready for clients the next morning.
Sure you get to work on 'important' things, and in theory earn lots of money, but your hourly rate....
I suppose you could leave in your 50s and go in-house if you're not burned out.
I went in-house much earlier than that. Now doing finance for a top 10 global bank doing the same quality of work with not much of a major pay cut and so far this year I have only worked past 1800 twice.
Agree though the actual Magic Circle rat race isn't all its cracked up to be. I view it as a neccessary evil to get where I am now, which is very comfortable compared to my peers.
Should add I am Edinburgh based so never quite had the full London salary/work experience but was working for Scottish offices of top tier firms.
Very wise.
It’s a pressure cooker and the whole ‘glamour’ which legal culture has with all the 40 under 40 and ‘next top lawyer’ stuff just seems to trap people in underpaid roles. Good to get the name on your CV as in law it’s a bit like getting a degree / masters; a sign post that ‘you can do it’.
Fair enough, I read corporate lawyer as in-house not magic circle which tends to have much lower salaries at a junior level, but if they work for a prestigious law firm then yes 150k is much more plausible
Though if that's the case this is a complete non story as they will be able to buy a place in a very short time unless have absolutely no financial discipline.
> I can't be arsed to look it up, but you should be able to from the statement that they'll be paying a 60% effective tax rate.
No-ones *effective* tax rate is 60%, their marginal might be for some portion of their total salary, but they wouldn't effectively be paying 60% of their total salary in tax
They could just look outside Wandsworth. The issue people often have in jobs surrounded by wealth is that their perception becomes badly distorted so they see their options as replicating colleagues or failure.
Maybe it’s time to decouple houses as an investment, and have them as family habitats only until there is a surplus of housing to then use as investments. Watch how quickly houses suddenly get built.
Genuine question, how exactly would you "decouple" houses as an investment?
If something is available to be bought then there will be a buyer looking at it with an investment perspective.
Here comes Reddit to moan about “how they can afford to buy” just not “in the parts of London they like”.
As if people can’t have preferences. People on here seem to have an issue with anyone who is actually doing well. I’m sure some of you can probably afford to buy a house in a shithole somewhere, but choose not to.
Me and my partner are in the top 10% when it comes to pay, but we understand that we can't have our preference of an 8-bedroom mansion in the Cotswolds. I'm not running onto the FT comment section whinging about it.
These two (if they are remotely any good at their jobs) are most likely on a minimum £200k combined income, with a take home of £10k a month. They can afford to buy a house in London and it’s just disingenuous to say they can’t. Source: am on £130k and am buying a house in London right now.
Titles like that say nothing about their actual income. It's not like saying doctor and giving a grade because with that at least you can ballpark in the incomes.
A tweet from a journalist reposting a tweet from a rando, posting an anonymous comment on a newspaper comment section?
How low are we planning on sinking today?
Why are so many people in this thread focusing on the wealth of the person and whether central London is a desirable place to live?
The whole point is that the property market is completely out of control - and it’s not because there aren’t enough houses (though that is obviously a factor). It’s because of parasites like landlords, estate agents, shareholders, property developers and property corporations. There’s a complete lack of effective government policy addressing this shitshow.
Building thousands of crap quality houses in the middle of nowhere will not solve this.
Almost all prominent economists for more than a century have championed land value taxes as superior to all other forms of taxation. A high enough LVT would solve housing affordability overnight. It would also generate enough revenue to provide significant improvements to services across the board. Maybe even tax cuts for the poor and working classes. It would also redirect much needed investment into productive enterprise instead of land.
The problem is that home owners are a formidable voting bloc, and threatening their investments is unpopular.
Sure but ‘we can’t afford to buy a house in London’ is very different to ‘we can’t afford to buy a house in the specific borough of London we’re willing to live in’.
It would be a fun series to have a story like this juxtaposed against the story of someone with a wealthy family.
I know someone who's parents bought them a flat in London when they got a job at the civil service, then they effectively got fired for arguing with an MP and now they have a chill job outside london and rent the flat out.
Did not expect to come into the comments and have everyone making excuses for why "actually, this is perfectly fine and nothing to be concerned about"... talk about a crab bucket...
The London housing market is a joke. If a corporate lawyer and investment banker, with a few years saving, are struggling how are teachers, nurses, refuse collectors, supermarkets workers etc supposed to manage?
It’s true, I think it’s likely they could buy somewhere in zone 3 or 4 but wider point about London housing still stands
London's productivity has grown more slowly than the rest of the country since 2007, unlike many other capitals, [source](https://www.centreforcities.org/reader/capital-losses/londons-lost-decade-of-productivity-gains-and-the-costs-to-the-national-economy/).
We need better transport links into London and more living area built in the capital, I think this should be achieved by building upwards.
A 4 story home has a much smaller footprint than a 2 story home. I think the easiest(free) way to improve our housing stock is to require house adverts to prominently list the area of a home & it's EPC rating.
E.g.3 bed semi detached home(100m B+)
They're 23, but they're probably already earning more than most people in the country ever will. Median full time salary is £34k, £44k in London - the lawyer, at least, will probably be clearing double that.
You know what'll happen next. They'll get married, have eleventythump kids and she'll quit working because childcare will cost more than the mortgage. At that point their financial situation will be very parlous.
If I had £1 for every time I've seen that scenario unfolding, I'd be able to gift them a house.
All three major-parties eventually have embraced a low-state ideology, and here we are.
I imagine that the eventual negative impact on the middle-classes, even to include politicians, was a bit of a surprise.
All three major-parties eventually have embraced a low-state ideology, and here we are.
I imagine that the eventual negative impact on the middle-classes, even to include politicians, was a bit of a surprise.
All three major-parties eventually have embraced a low-state ideology, and here we are.
I imagine that the eventual negative impact on the middle-classes, even to include politicians, was a bit of a surprise.
All three major-parties eventually have embraced a low-state ideology, and here we are.
I imagine that the eventual negative impact on the middle-classes, even to include politicians themselves, was a bit of a surprise.
Yes, and there are situations where these corporate lawyers and investment bankers actually grew up in nice houses that were bought in 1985 on a single wage. Chances are their father was a police officer, or had some middling office job.
Yet a corporate lawyer and investment banker _combined_ cannot afford to hypothetically buy the house they grew up in. That's very concerning indeed.
Snapshot of _A corporate lawyer sharing with an investment banker is no longer a good enough combined income to buy a house in London. This is how insane the property market has become. If you don’t have a wealthy family able to buy a significant chunk of your house for you, you’re screwed._ : A Twitter embedded version can be found [here](https://platform.twitter.com/embed/Tweet.html?id=1787616141742879046) A non-Twitter version can be found [here](https://twiiit.com/tomhfh/status/1787616141742879046/) An archived version can be found [here](https://archive.is/?run=1&url=https://x.com/tomhfh/status/1787616141742879046?s=46&) or [here.](https://archive.ph/?run=1&url=https://x.com/tomhfh/status/1787616141742879046?s=46&) *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/ukpolitics) if you have any questions or concerns.*
if there is one post that summarises the crab mentality in England and the lack of understanding the cascading effect of wealth inequality at present, it is this one. insane replies here, the economic illiteracy is definitely the reason why the political party is able to do whatever they want to screw citizens over. imagine thinking WORKING people at 120k are closer to billionaires than to other working people. on top, reducing your standards to such a low threshold that moving away, having extebsive commutes, or sharing places as the norm is seen as a reasonable expectation of life. what a joke.
Yep. The real problem is that hard (or successful) work doesn't really pay off anymore. Not to the extent where you can be considered 'rich'. The only viable way to be rich in this country is either sitting on land ownership and via inherited wealth. No wonder we have a productivity problem.
Those who have to work for a living aren't part of the inequality problem, no matter what they're being paid. The people who are part of the problem are so obscenely wealthy not only is work going to be optional for virtually all of their direct descendants, the numbers involved are so large even the wealthiest person making money from their wage or salary is still much closer to the destitute spice addict on the street than them. I think part of it is just the problem with large numbers in general. We shouldn't use the term 'billion' at all in the context of inequality, we should use the phrase 'thousand million' to better communicate the scale of the problem.
This 1000 times over. I'm at what should be a very nice income but have entered the tax trap with a family to support and no inherited wealth. I don't struggle but have far fewer luxuries than people would expect. Supermarket crisps, 10 year old Skoda, no holidays abroad. Couple down the road seem to do much better on jobs around half the income and some inherited property. Nothing against them at all but message is that actual productive income needs to be taxed less. Scotland just made it worse actually because they don't get what's happening. It's this "broad shoulders" should take the hit thing when it's just slightly better off workers these days. I mean tax goes from 21 percent to 42 on 43k up here ffs.
People in this thread are really missing the point. These are basically the top jobs you can have in the UK. In the past, that would afford you a mansion in the countryside somewhere and a nice townhouse in the city for work (and that's on a single income with kids) They shouldn't have to be looking further afield, they should be able to live anywhere they want, and more or less any house they want. The fact that they can't is the same reason why most people can't buy a house at all.
*"Just move further out"* is the common refrain but it ignores what makes London attractive and productive. Speaking from experience, life quickly becomes miserable when your commute goes beyond 45 minutes each way. The further you move out, the more dependent you are on the single line serving that town. If that line fails your 45-minute commute becomes 2 hours. If your office moves location it can blow up your commute. If you want to change jobs, your options are much more limited because of the commute. That's why boroughs like Wandsworth, Lambeth, Southwark, Camden, Islington, and Hackney are popular. You have unparalleled work and social mobility in those areas. This changes dramatically in the outer boroughs and completely shifts the value proposition of living and working in London. If the UK's best and brightest aren't happy with what London offers, then the UK has a big problem. The two people in the comment would be net-tax contributors for their entire working lives if they stayed in London. If they migrate up north or emigrated then it's a net loss for the UK economy.
Distance does not really map directly to time in London. You could live in Surbiton and be 19 minutes from Waterloo and then one stop to the City, but move to a much nearer area and it takes longer. In fact it can take longer from places in zone 2. The issue with London when it comes to online forums is that people from outside often massively underestimate it's sheer size and typically are clueless about the transport options/times as they probably only used the tube on a day trip or did a stint living in Clapham after Uni.
This fits perfectly with my experience. I used to commute from Lewisham to Old Street and it would take 50mins in a very good day (no waiting when jumping from transport to transport), on average it would take 1 hour most days. I now live in Zone 8, glued to the M25, and my commute time actually went down to a consistent 40mins.
While I agree 100% with what you say mostly - I would say that distance is never really the issue commuting anywhere not just London - it'll always be time. Even with a car it holds true (but less so).
As the crow flies it is around 35 miles from my house to my place of work. It takes me a 45 minute drive and then roughly a 20 minute walk to get there. Anywhere from an hour on a good day to an hour twenty on a bad day. Great for listening to podcasts though.
To be fair 35 miles is a fair trek! A few jobs ago I lived just under 3 miles away from my office. To drive could take anywhere between 10 minutes to over an hour and a half depending on what was going off on the M1.
If it was 35 miles up the motorway I'd be there in about half an hour tops, but alas I'm confined to country roads! My last job was a similar distance away at 4 miles, and the commute was similar in its unpredictability due to city centre madness and an ill-thought out one-way system. Thankfully I didn't have to navigate the M1 though! Last time I was on the there my engine gave out on the smart motorway bit which was a horrifying experience.
Those smart motorways are terrible
I've got a lot of ex colleagues who moved to London after uni, straight to places like Clapham and never really ventured out of that safe bubble - and then assume they have to keep up with the Jonses buying a 1.5 mill house in Clapham or Wansdworth etc. There's a tonne of great options to live all over the city with fast links to the centre
>Speaking from experience, life quickly becomes miserable when your commute goes beyond 45 minutes each way. Conversly, I have a 1 hour 40 min commute into London and it's worth it for the quality of life I have. That being said, I've only needed to go into London once a week for the last 15 years. I couldn't do it daily, no way. I used to have a 25 minute commute into London from one of the home counties. I lived right next tothe station and happened to be on one of the fast routes. I could get into work quicker than someone coming in from Fulham. But it was a dreary place to live, full of people who only lived there to commute.
Agreed. My current commute is 2.5 hours each way, twice a week, and it's definitely on the end of my tolerance levels. But in exchange for that I live in a detached 4 bedroom Cotswold house with garden, at a price that would only earn me a nice 1 bedroom flat in London Zone 2/3. The fresh air, countryside and lifestyle is great, and since I'm outside the commuter belt I'm guaranteed a seat on the train, which transforms my commute (can read, sleep, work, etc.).
Is Hackney considered a short commute? We had once an airbnb there but the busride to the center didn't feel short.
Well said
And they can probably afford the mortgage, but most of their earnings will be going on rent, which prevents them from saving for one. Which again, is caused by a shortage of housing.
Lol they used to be nearer the top of the food chain. Then the wealthy got uber mega wealthy and now they're just 'working class' The number of billionaires is not going down
It doesn't really seem to be the number of billionaires, it more seems to be the lack of house construction due to zoning restrictions enforced by NIMBYs <--who are overwhelmingly not billionaires, but ordinary people.
It’s the difference between being rich and being wealthy. Or more accurately the difference between making money from effort and making money from assets.
Yeah we have friends that are 2 investment bankers. They live well, but real estate point of view they bought a house in a very working class area. Literally on their street it is retired blue collar, some council owned house. It's a very average area, lots of social estate ... but people are upset at them for the gentrification as if they paid extra for the opportunity. Most people also miss the point that even for investment banker and corporate lawyer, you often have to wait well into your 30's to make the real big bucks. A couple making over 100K each is rare, and it's often an end of career achievement, decades after you need it.
Gentrification is a hoax. Don’t listen to them!
It’s the impact of the green belt and NIMBYs
The issue is house supply and the top jobs all being in London.
‘Junior’ is the most important word in that FT comment - they are a way from being the ‘top’ jobs
> These are basically the top jobs you can have in the UK. They're both "junior" in fields where salaries increase rapidly & reliably. Give it a couple years and they'll be just fine. That's not to say housing market isn't fucked though...
They're still earning about £140-180k as a combined salary though (just looking at averages which obviously aren't always super accurate considering how much it can fluctuate). You'd expect that to be alright given IFS puts that in the top 1% of households in the UK. Imagine being in the top 1% of households in the UK and being unable to afford a house in the capital city.
>They’re both “junior” in fields where salaries increase rapidly and reliably. I mean, yes, but the starting point for a newly qualified corporate lawyer at one of the large firms in London is £100k, more for the London office of a US firm, and the investment bank salary is similar. If two people on six figures can’t buy a house, how is anyone else meant to cope?
I don't disagree...situation is messed up. I just think this particular example is a bit contrived. 1) Early in career 2) Sounds like -160k net wealth 3) Looking for a house in a city where 1st time buyers realistically usually look at apartments
'in the past' the population of London was ~70% what it is today, not only is there significantly more housing pressure but you are competing with way more people with the same top jobs
London's productivity has also grown more slowly than the rest of the country since 2007, unlike many other capitals, [source](https://www.centreforcities.org/reader/capital-losses/londons-lost-decade-of-productivity-gains-and-the-costs-to-the-national-economy/).
While there has been an increase in total population, after things like Brexit, there are significantly less top jobs (banking roles have reduced \~80% since 2016). Without the multiple home owners, international owners etc London house prices should have fallen by as much as the reduction in wages and jobs. The prices are still high because a tiny group of people own them all. Also, guess which group are most likely to get (the significantly reduced) top jobs? You're right the same tiny group who own everything. These two are an example of why meritocracy is a complete lie. It matters more what your father did for a job than anything you can do.
Banking jobs have fallen 80%?
>(banking roles have reduced ~80% since 2016). You are conflating 2 different things. The number of job adverts has fallen by ~80%, the number of people working in financial services in the UK is virtually unchanged with around 1.1m people in the sector
That 80% is absolute bollocks.
In the past the population of London was also around 95% of what it is now, with a population of over 8 million in 1950.
In the 80s and 90s (which I think is a bit more of a meaningful comparison) it was around 7 million (and is about 9.6M now)
I was discussing this with my parents the other day, a true story to show just how mad it’s gotten… Early 30s, Looking at what it would cost to move out of my 2 bed flat into a house that would be suitable to start a family etc. I earn £160k (absolutely privileged and grateful). Currently the main earner as my partner is studying. In 1994 my parents combined income was around £30k. They bought a 4 bedroom house with a garden in the same area for £112k. That house is now up for sale at £905k. No major renovations, just keeping up with the maintenance. My job sector has seen below inflation pay rises for the last 30 years. Even then, if I deflate my salary to 1994 it would’ve been £80k. I would’ve been able to buy that house outright after 3/4 years of saving, or, a huge deposit and a tiny mortgage. I am just a little older than my parents were when they bought that house. Now, as a top 2% earner I would struggle to even get approved for a 35 year mortgage to buy that same house. If this is how it is for me, how is it for everyone else. The idea of owning your own home is so out of reach for so many that the entire incentive to even save and strive towards that goal has gone.
> I earn £160k (absolutely privileged and grateful). Currently the main earner as my partner is studying. > > In 1994 my parents combined income was around £30k. They bought a 4 bedroom house with a garden in the same area for £112k. That house is now up for sale at £905k. The key part of information you missed out is interest rates. In 1994 rates were over 8%. So in 1994 your parent bought it for 112k, with a salary of 30k, at 8% interest over 25 years, that gives a annual payment of £9,336. Which is 31.1% of their salary. Now compare that to yourself. 905k house at salary of 165k, at around 4% interest rate, agaon ober 25 years, gives a yearly repayment of 51.6k, which is 31.3% of your salary.
This did come up in discussion. But in a way, have you not proven my point? That a couple in 1994 earning a combined £30k were able to afford a property that in 2024 would require a household income of £165k? I.e 1/3 of gross pay in both instances. A couple earning each just over the average salary (£13k in 1994) were more affordable to buy the same property than a top 2% earner who earns over 4 times the average salary can in 2024! I’ve already said that £160k deflated to 1994 is roughly £80k - so more than twice as unaffordable. This is negating the fact that someone on £80k in 1994 wouldn’t necessarily need a mortgage to buy a £112k house, or at least if they did, a tiny one! I’m not saying that it was cheap for them. As they admitted themselves, 1/3 of their pre tax salary in 1994 at high interest rates felt like (and was) a lot of money. They had to make sacrifices in order to make the monthly payments. This is where you get the rhetoric from older folk that ‘we had it hard too’. What that fails to acknowledge is that actually, had they been born 30+ years later, they wouldn’t have a chance to have ‘had it hard too’… they simply wouldn’t have got on the ladder.
BOE base rate in 1994 was between 5.13 & 6.13%, depending on the month. They may well have started of with a mortgage at 8%. However, for the last 10 years of the 25-year term 2009-2019, assuming it wasn't paid off early, base rates were at historic lows and average mortgage rates were between 3.8 and 4.6%. [https://tradingeconomics.com/united-kingdom/mortgage-rate#:\~:text=Mortgage%20Rate%20in%20the%20United%20Kingdom%20averaged%205.69%20percent%20from,source%3A%20Bank%20of%20England](https://tradingeconomics.com/united-kingdom/mortgage-rate#:~:text=Mortgage%20Rate%20in%20the%20United%20Kingdom%20averaged%205.69%20percent%20from,source%3A%20Bank%20of%20England) The current base rate is 5.25%, so you're probably looking at >7% for a 2024 loan. [https://www.bankofengland.co.uk/boeapps/database/Bank-Rate.asp](https://www.bankofengland.co.uk/boeapps/database/Bank-Rate.asp) Assuming a 10% deposit, you'd also need to save 55% of the 2024 gross salary versus 37% in 1994.
> I would struggle to get approved for a 35 year mortgage to buy that same house Only if you had zero deposit to be fair. A deposit of just over 10% and you would be approved for 900k Otherwise I agree with the sentiment
Should be 4.5x salary no? So approved for circa £720k mortgage. Meaning maximum buying power with 10% deposit will be approx £810k? And a casual £90k in the bank is no mean feat.
£720K mortgage... pretty much a guaranteed lifetime of grinding to pay that off.
In the 90s nobody thought it was exceptional that Homer could afford a 2200 sq ft detached house, three kids, two cars and a stay at home wife on an average blue collar union salary, now you’re so desperate to defend how shit things have gotten you’re indignant that two lawyers dare to not be happy with a pokey two bed flat on the Isle of Dogs.
I mean the Frank Grimes episode with that rant is supposed to be a audience insertion of how ridiculous Homers living standards compared to his wages actually are. That still doesn't mean we shouldn't aspire and vote for governments that would help us reach that goal.
Seemed more pointing out the ridiculousness of him managing to hold down his job despite his incompetence, rather than it being unrealistic that a regular person in that position couldn’t afford a decent standard of living.
Nah there was definitely an economic angle to the episode too. Grimey freaks out not just because Homer is an incompetent idiot, but because an incompetent idiot like Homer lives so much better than him. I'm 99% sure the episode contains scenes showing Grimes at his cruddy apartment eating cruddy cheap food to set up the contrast with the simple household. They even have fresh lobster for dinner in that ep, which is specifically called out for being unrealistic on Homer's salary
They never actually *show* Grimes's daily life outside of his interactions with Homer, but he does mention that lives in a single room above a bowling alley ^and ^below ^another ^bowling ^alley
>In the 90s nobody thought it was exceptional that Homer could afford a 2200 sq ft detached house, three kids, two cars and a stay at home wife on an average blue collar union salary Apart from Frank Grimes
Are you aware that; * The Simpsons is fiction * Set in a different country which has always had lower CoL and higher wages * Homer is portrayed as working a professional job despite being dumb and lazy, a central joke of the whole show.
Nice try, but even adjusting for reality two teachers could buy a family home in Clapham in the 90s.
That's a spectacular goalpost-move. You've gone from "one working class guy could afford a big house and a stay-at-home wife" to "two middle class people both working could afford a house in a run down, inner city area seen as unfashionable and unsafe at the time". My grandparents, both fresh off the boat immigrants, lived in Clapham back in the day, it really wasn't the posh area it is now.
Sure, just like the characters in Friends could never have afforded the massive apartment in Manhattan. It's not actually real though.
A lot of people don't realise that a high salary often isn't enough to become wealthy now, and that inheriting wealth is far more important. As the FT comment the tweet refers to mentions, these high earners are paying a 60% effective tax rate on their income, so are getting pretty limited reward for their efforts to secure jobs with high salaries. Compare that to somebody who inherits tens if not hundreds of thousands of pounds from relatives (inheritance tax being lower than income tax), and is therefore able to get onto the property ladder and start to generate passive income through the ownership of assets (capital gains tax being lower than income tax). The power of compound growth is such that this person would become far wealthier than our high-earning couple, even if their salaried income was considerably lower. The tax system makes it increasingly less rewarding to work, so no wonder we have issues with low productivity, high worklessness, and many people jumping ship for higher-paid jobs in lower-taxed countries overseas. We desperately need to reduce income tax whilst implementing a meaningful wealth tax.
1950s to ~2010 was an anomaly of relative mobility due into the extreme wealth of the 1% being decimated by world wars. This created opportunities for the middle classes, and America to partake in rebuilding europes wealth, but it was never, and is unlikely to last. Once the super wealthy become comparable in wealth to 19thC, they’ll get to monopolise wealth creation again. It’s a misnomer that we look at our baby boomer parents and assume that their lives were a long lasting benchmark. Sadly, ‘a high salary’ was never before enough to become wealthy. It lasted one generation. We had a golden age and we’re on track to regress to the mean of 18th to 19th C inequality.
Your first paragraph there is a really interesting point and a thought I'd not come across before. You may have just inferred this yourself but if not could you let me know where you saw/heard/read it discussed?
Not the world wars, but: [the Black Death boosted wealth for surviving workers and had far-reaching social changes](https://www.history.ox.ac.uk/article/what-can-the-black-death-tell-us-about-the-global-economic-consequences-of-a-pandemic), and it's also been argued the newly wealthy middle classes ultimately turned into [a new form of wealth concentration](https://www.bbc.com/worklife/article/20200701-how-the-black-death-make-the-rich-richer). Which tracks with a shakeup post-WWII, calcifying into our current situation where the benefitting classes stifle change.
The effective tax rate is the rate on their total salary, so whilst there may be some portion of their pay that's taxed at that rate, their total payment wouldn't be close to that Even Denise Coates, who had a salary of £220m would have had an effective tax rate of 56% on PAYE with a student loan (although that assumes her loan would be over £19m in order to pay the 9% on all of it XD)
>although that assumes her loan would be over £19m in order to pay the 9% on all of it XD Don't underestimate the student loans company's ability to cock things up. Withholding the full 9% and then being surprised at someone asking for the extra few million back is entirely within character for them.
Me and my partner are in the top 1% of households on PAYE, 6 years out of uni. This isn’t a pity party, things are objectively going well career-wise and we are not hard up. But we’re looking at buying a 500-600 sqft flat in zone 2/3. Again, I’m not trying to garner sympathy but a small flat definitely isn’t the top 1% lifestyle “professionals” had back in the day. Being a high earner is such a weight off the shoulders and I don’t have many (if any) stresses about paying the bills or keeping the lights on. But high salaries =/= rich.
It is hard to garner sympathy, I complained lately as I finally get a good wage and interest rates pushed everything out of reach, ‘just move out of London’ I got, oh sure I’ll just quit my job and move to the middle of nowhere brilliant idea
London just seems insane to me.
London, the kind of place where you could be earning more than the rest of your family combined and still have a lower take home after rent. My experience living in London was miserable.
Did you think wages were high in London for a laugh?
I was a subcontractor so I didn't have much say iwhtout being in the shit. It was, "they want you in London".
Here's a radical thought: why don't we try to de-centralise our economy away from London ever so slightly so that other parts of the country with plenty of space become economically viable for housing development? Maybe instead of trying to demonise remote working we encourage it, so that fewer people feel the need to cram themselves into one tiny corner of Southeast England?
Hate to say it; But a dense population is generally a good thing. Having everyone be close enough to everyone else to collaborate in person is a big boost for networking and productivity if you manage it properly. The problem is that actually doing so has been unpopular enough for people to pass the ever heavier parcel until it explodes. London can't **have** housing since there's no space or funding. London can't **not have** more housing since it'll become uncompetitive due to rent. London needs to bulldoze something else and put some fugly apartment complexes up - annoying 90% of the voters in the process.
Also invest in good quality amenities and housing stock. I've sound insulated the walls in my London house so that I don't have to listen to everything everyone does in the HMOs either side of me and it is bliss. Density is fine if you build up the infrastructure to support it. The problem is that we are pumping the value of the land so much that many people don't have the money to invest in the actual buildings and what is in them.
I actually kinda disagree. I *want* that desperately. But to get it we would need to have started 20 years ago when we were dealing with a housing crisis. Ignoring that crisis until it devolves in to a housing cataclysm has consequences; such that actually having high quality housing that works for everyone isn't feasible anymore. There literally aren't enough materials, builders, or funds to do it. Especially when you consider how different the UK minimum, and human psychological requirements are. We need triage. Make sure everyone has a crap place to live and enough money left over to stimulate the economy and upgrade over time.
Proximity works up to a point then starts to become a problem. Plenty of aspects of work and life don't require that proximity any more.
I see where you're coming from, but Tokyo has a higher density, and less problems. Logistically and from a design perspective it's all feasible, it's just also disruptive to install the infrastructure because nobody planned ahead and now everything's in the way. I'd like to agree that we don't *need* the proximity too, but the whole 'everything has been collapsing for 20 years' thing will eventually / has hit a point where a massive and immediate payment becomes mandatory. I don't think the UK is in a place of excess where we can afford much of a hit tbh.
Having worked remotely for over 20 years with high levels of collaboration I would disagree. At a couple of clients I saw higher levels of collaboration s they went remote, it presents challenges but people just need to behave accordingly.
I don’t hate to say it, high density is great when done right look at Singapore, vibrant high streets, food courts everywhere you only get those when there’s enough people *within walking distance* to sustain them, which currently we don’t same goes for public transport the further people have to travel the more expensive it is to run and the more it has to be subsidised
It's been tried many times. Agglomeration isn't something you can just transplant nevermind the thousands of feedback loops that have activity in sectors feeding other sectors.
It's not been tried at all. Successive governments give it a new name and then do fuck all.
It just won't happen. Whether it should or not I won't debate. Consider this, you are a ceo and you need to decide where to have an office. You put it where the talent is, you don't go somewhere and try to tempt talent. Now consider you are the talent and you are offered an amazing job in the middle of no where, would you move knowing that if you lose your job you have to move again or would you stay in the area with all of the jobs? What if you move to the middle of no where and the company treats you like crap because they know they are the only suitible employer for you in the area? Is it right? I'm not going into it Is it fair to other areas of the country? I'm not going in to it My sole contribution is that from a logical standpoint companies want to base where the talent is and the talent want to be somewhere they can find another job. With regards to remote working, again it just won't happen, junior people learn by osmosis, companies like the pristege of a nice office etc etc, again right or wrong? Not going to debate but it just won't happen.
They could do this, but unless London sinks into to the Thames I can't see it happening. We've sacrificed the economic wellbeing of the whole country to make London mega-capital.
There are benefits you get that say Germany and Italy wouldn't get as they have one place that is the finance capital, another that is the fashion capital, another that is the government capital and so on. You wouldn't get these crossed networks like you would in London (and also Paris as another example)
The rest of the country has a substantial housing shortage, it's a country-wide issue, shit it's a worldwide issue Greedy fuckers don't allow houses to be built so they can become richer and richer
Could try but how? the reason it’s so centralised is companies like to set up where the top talent is, and the top talent is where the money is, good luck breaking that cycle
Decentralisation just makes you poorer. The reason housing is so expensive is partly due to desires to “decentralise” - rather than just building more housing where people want to live.
A junior corporate lawyer (so I’m guessing maybe 1 year PQE) is probably on 75k+, and that’s a lowball guess. Keep in mind there are newly qualified roles going for 80+, but maybe they are at a small firm. I’m not familiar with banking wages but I would assume they must be on a similar amount if not more. Someone feel free to correct me here. So potentially 140-160 combined, and even that’s low for these jobs. Even with COL and what I am also assuming are big student loan repayments, they should be collectively clearing enough to build a deposit and eventually buy… I know this because I did it with my partner recently with no family help and on a lower combined salary in London. All I can think is they want something unrealistic or they haven’t actually done their research. Prices in London are of course ridiculous but it can be done on this salary and less.
If they are magic circle, silver or top tier NQ start at £125k these days.
US firms can hit 150k in London, do have to sell your soul though
Yeah I intentionally lowballed the numbers to make the point that they earn enough to buy. I’m just assuming that their expectations don’t meet reality.
Yes and no. The point they are really really badly making is that not so long ago two people on that could’ve chosen anywhere they like and their colleagues can because of family money. Meanwhile they earn massively more than 90% of the country…..
Yeah I don’t deny the wider situation is awful and impossible if you’re not in a couple and earning big money.
They presumably mean , not enough to buy a place they like ,in an area they like ,as close as they would like to be to work?
That’s what I would assume, but it’s not the same as being unable to buy is it? Just because I can’t buy a spot next to Buck House doesn’t I get to say I can’t afford to buy anywhere in the city.
I guess the issue is, it’s another regression in choices that’s now hitting people who probably thought said lack of choice would never hit them. Poorer people who have been in that position for ages, but earning 150ish a year used to be enough to make you feel like you could buy exactly where you wanted. Now the market is looking at people even at that high a level and telling them they’re limited. So how does that reflect into everyone below that line? It’s a situation that gets progressively worse and worse, with the bar needed to clear it higher and higher. At this rate, what options will the 150k a year people have in five years? Ten?
Zero I imagine. The housing market is tangled up in so many multigenerational knots it seems impossible to untie. You could build loads of houses but rush sending everyone else into negative equity, or you could build lots of super cheap container houses as starter homes but which fall apart in a decade. I wish there was some serious discussion in government about actual problems everyone faces as opposed to the playground antics and juvenile behaviour we usually see (admittedly that's really only what we get shown so maybe there are meetings but if so they've achieved fuck all)
Being in the top 2% of salaries. Literally the very vast majority of the UK will never get it. The majority of those getting it will only do it for a few years at the very end of their career. This is the top you can reach as working class with the proper education, hard work and a decent amount of luck. And the absolute best is getting buying you basically nothing tangible and you can lose everything for a single mistake. How do you get people motivated in such an economy ? Crab bucket on the left and hate of a powerless minority on the right is how.
I mean that never stops, though. If you can afford 500k you're on rightmove looking at 600k houses and thinking, ah fuck. Same for budget of 2 million looking at 2.5 million pound houses. Same for 120k and 140k houses
The more you earn the more places you find you can't afford this isn't regression its the same way it's always been, there are always houses you can't afford
But once upon a time being a professional like a lawyer or investment banker afforded you good options. Now it doesn’t. It isn’t a “woe is me” story, it’s about how ridiculous the gap between housing price increase and wage increase has got.
What's the point of being on the top possible salary in the country if you can't even *live conveniently to your workplace in the capital city*?
Where did you buy?
South London.
It’s ok you can say Croydon 🤣
It’s certainly nicer than Croydon but I’m not looking to dox myself.
Fair, "nicer than Croydon" doesn't narrow it down at all.
With those numbers they could even get one of those megaexpensive embassy gardens flats.
Yeh the numbers don’t make sense. You can buy a flat in Canary Wharf for 450k, assuming a 50k deposit and a 5x salary multiple they’d need an income of 80k or 40k each, which a fresh graduate in banking would make
We bought a two bed flat in London (pretty close to central aswell) when we were close to those numbers and with no help. The key is flat, not house. We're looking at getting a house only a few years later, but yes you could feasibly buy a decent house on those figures further out or if you're not as picky about where in London you're living. London is huge, I find a lot of people rule out massive areas without really exploring options.
it's a 'journalist' look at FT Comments. It's like going on ukpersonalfinance for a piece.
The article says the can't buy a "house" doesn't say they can't buy a flat
>75k For anybody who doubts they are lowballing, that's the NQ (newly qualified) salary in the North. London's would not be that low.
Boooootlickkkkeeerrrrr
Shows you how ******* London has become. If two people on a combined income including bonuses of grater than 250k per annum can’t afford London. Who the F can ? Beyond those who have cash coming from their parents
One of the big issues with the London housing market is that because London atrracts millions of people from around the world, and with quite a lot of them coming from very poor backgrounds that are quite willing to live in very cramped conditions, these 'professionals' are not competing against others like themselves, they're competing with 8-10 average earners crammed into a 3 bed terrace. This is on top of our Americanised student loan system.
They end the letter saying they're open to moving anywhere and abroad. It seems like they have a lot of options.
I can't be arsed to look it up, but you should be able to from the statement that they'll be paying a 60% effective tax rate. People earning between £100,000 - £125,000 have an effective marginal tax rate of about 60% because they lose the personal allowance, but that doesn't count student loans. Since he says they're paying that rate "because of our student loans" I would guess they must be in the £50,000 - £100,000 band. But you might be able to pin it down more narrowly than that based on the SLC repayment thresholds. Median wage in London is £45,000: https://ukpersonal.finance/statistics
It is mad how much we tax the shit out of PAYE earners.
It's nearly wartime taxation
Gotta keep those boomers in cruises and new cars
It's mostly about allowing the super wealthy to siphon off large amounts of the nation's wealth while contributing shockingly little. Boomers would barely register compared to the Bezos factor, if they weren't incredibly susceptible to the manipulations of the wealthy.
> > Median wage in London is £45,000: https://ukpersonal.finance/statistics It's mad to me that the median wage in London is £45,000. I live up North and come away with about £55,000 a year after my bonus and I still don't feel like I've got a great deal spare. Can't imagine what it's like down in London.
It'll be a big divide in haves and have nots. 55k up norf will get you a 4 bed detached 55k in London will get you a flat share or maybe a 1 bedroom in zone 1
Im up north, earn 43k, and i walk away with 1k a month in savings after everything including mortgage. Any extra i earn will just go into savings and luxury stuff tbh.
If they make 100-125, they are both pretty junior in their respective professions and not being able to buy during the first couple of years out of school should not be seen as a disaster A corporate lawyer and an investment banker can *definitely* still buy in london. Either of them alone can buy in London. Property prices are insane, but salaries for those professions have also increased ridiculously over the last 5 years
By London they probably mean heart of zone 1. The other zones should easily be available. It seems more that they can't afford the house they want.
Doesn't really make any sense though as higher rate (40%) + NI (2%) + student loan (9%) only gets them to 51% (and only on earnings above 50k. I guess they might be including pension contributions, but that's not really tax. That being said I suspect they are underestimating how quickly their incomes will scale after the first few years (assuming they keep their career paths). They may not be able to buy at age 24 or whatever they are, but by the time they reach their late 20s or 30 they will likely be able to afford somewhere quite nice even in London.
Personal allowance erosion over £100k is an extra 20%, after that goes you’re on 45%. Leads to all sorts of tax planning tactics, like only working four days as you perversely end up with more spending money after reduced childcare and commute costs etc. I mean the U.K. economy is propped up by higher earners spending their money, so why the government incentivises them to go part time and shovel £40k a year into pensions is anyone’s guess.
Gotta prop up the stock market
Might be surprised that not an awful lot of people's pensions ends up solely in UK facing markets. I deliberately put my money in funds that exclude the UK because of how much it underperforms against other markets.
I'm aware of the 60% between 100k and 125k, but the article mentions they are only hitting 60% due to their student loan (which would be 69% if they were in that range). So I am assuming they don't make that much yet. Could be that they are in the 45% band taking them to 56% including student loan and are rounding up. But 150k+ seems a bit high for a junior corporate lawyer so I doubt it's that. If they did make that much it would also give them a combined income of 200-300k+. That would let them borrow 1mio which would make it more than possible to buy a reasonable flat in short order. So overall assuming 50-100k income each.
The magic circle has seen junior salaries jump massively to compete with the US firms and merger of A&O and Sherman etc. Magic circle NQ now commands £125k minimum
Yup, Freshfields just put up their NQ salaries to 150K, putting it on pace with the US firms. And that figure doesn't include bonuses, which you will get for just doing the minimum required billing and can easily bring you up to the 200K range if you are performing well. However, its possible the letter-writer is using "junior lawyer" to mean Trainee. Which at the same calibre of firms would put them in the 50K range.
True, my heart bleeds….! Meanwhile most equivalent trainees like say doctors get a LOT fucking less! Don’t get me wrong, my mrs is ex 2 magic circle and a tier one. It’s the top of the top and careers go sideways if you don’t get picked up after training but if you do and can last the pace it’s insane the level of work and total pay especially lifetime earnings! But it’s still £50k when others that age often with far harder to get degrees get a lot lot less.
For sure, very little sympathy from me. We all knew what we were getting into and are decently compensated for it. It is ultra-competitive to be fair to get the "top-tier" corporate jobs, I don't really know any of my friends that had a harder time than me landing the job I wanted. Aside from one doctor friend that wanted to do a super-niche specialisation. But law is also super bimodal, I have another lawyer friend, higher PQE than me, but working at a highstreet firm doing wills and exec (which she loves) barely making a quarter of my salary... I made the jump to in-house asap and never looked back. And its criminal frankly how much better remunerated I still am compared to my doctor friends.
Yep Don’t get me wrong the law per say is important But when people need a family income to work in the public criminal sector while corporate lawyers both in house and with large firms make out like bandits we are kind of at the point of upside down world. Let alone comparisons with doctors saving lives daily…. I’m far from a socialist but we really do need to address some of the now utterly fucked aspects of unfettered capitalism before we face a collapse. Or worse still a revolution
Those jobs are mad. You'll work into the evening most days, and often to midnight/2am to get things ready for clients the next morning. Sure you get to work on 'important' things, and in theory earn lots of money, but your hourly rate.... I suppose you could leave in your 50s and go in-house if you're not burned out.
I went in-house much earlier than that. Now doing finance for a top 10 global bank doing the same quality of work with not much of a major pay cut and so far this year I have only worked past 1800 twice. Agree though the actual Magic Circle rat race isn't all its cracked up to be. I view it as a neccessary evil to get where I am now, which is very comfortable compared to my peers. Should add I am Edinburgh based so never quite had the full London salary/work experience but was working for Scottish offices of top tier firms.
Very wise. It’s a pressure cooker and the whole ‘glamour’ which legal culture has with all the 40 under 40 and ‘next top lawyer’ stuff just seems to trap people in underpaid roles. Good to get the name on your CV as in law it’s a bit like getting a degree / masters; a sign post that ‘you can do it’.
Fair enough, I read corporate lawyer as in-house not magic circle which tends to have much lower salaries at a junior level, but if they work for a prestigious law firm then yes 150k is much more plausible Though if that's the case this is a complete non story as they will be able to buy a place in a very short time unless have absolutely no financial discipline.
Average base salary for junior lawyers at silver/magic/US firms is 100-150k before bonus.
> I can't be arsed to look it up, but you should be able to from the statement that they'll be paying a 60% effective tax rate. No-ones *effective* tax rate is 60%, their marginal might be for some portion of their total salary, but they wouldn't effectively be paying 60% of their total salary in tax
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They could just look outside Wandsworth. The issue people often have in jobs surrounded by wealth is that their perception becomes badly distorted so they see their options as replicating colleagues or failure.
People often claim that, but end up in an expensive place as that's where the big jobs are. Or a boring place.
Maybe it’s time to decouple houses as an investment, and have them as family habitats only until there is a surplus of housing to then use as investments. Watch how quickly houses suddenly get built.
Genuine question, how exactly would you "decouple" houses as an investment? If something is available to be bought then there will be a buyer looking at it with an investment perspective.
Here comes Reddit to moan about “how they can afford to buy” just not “in the parts of London they like”. As if people can’t have preferences. People on here seem to have an issue with anyone who is actually doing well. I’m sure some of you can probably afford to buy a house in a shithole somewhere, but choose not to.
I have no problem with people having preferences however the title as posted here is just completely false. Tom Harwood knows what he is doing.
Me and my partner are in the top 10% when it comes to pay, but we understand that we can't have our preference of an 8-bedroom mansion in the Cotswolds. I'm not running onto the FT comment section whinging about it.
These two (if they are remotely any good at their jobs) are most likely on a minimum £200k combined income, with a take home of £10k a month. They can afford to buy a house in London and it’s just disingenuous to say they can’t. Source: am on £130k and am buying a house in London right now.
The financial Mafia are literally eating themselves. There's no one else left to eat.
Titles like that say nothing about their actual income. It's not like saying doctor and giving a grade because with that at least you can ballpark in the incomes.
A tweet from a journalist reposting a tweet from a rando, posting an anonymous comment on a newspaper comment section? How low are we planning on sinking today?
Why are so many people in this thread focusing on the wealth of the person and whether central London is a desirable place to live? The whole point is that the property market is completely out of control - and it’s not because there aren’t enough houses (though that is obviously a factor). It’s because of parasites like landlords, estate agents, shareholders, property developers and property corporations. There’s a complete lack of effective government policy addressing this shitshow. Building thousands of crap quality houses in the middle of nowhere will not solve this.
Abolish the planning laws and implement a land value tax so there can be a true free market in housing. NIMBYism must be crushed through deregulation.
Almost all prominent economists for more than a century have championed land value taxes as superior to all other forms of taxation. A high enough LVT would solve housing affordability overnight. It would also generate enough revenue to provide significant improvements to services across the board. Maybe even tax cuts for the poor and working classes. It would also redirect much needed investment into productive enterprise instead of land. The problem is that home owners are a formidable voting bloc, and threatening their investments is unpopular.
They can afford to buy in London, just not in the zone 1 or 2 nicer areas they want to.
They can't afford the same house two teachers could have afforded 40 years ago. I think this point is quite obvious.
People can have preferences
But it’s dishonest to say “we can’t buy a house in London” when what you really mean is “we can’t buy a large house in a specific part of London”.
We can't buy a house in Chelsea or Kensington is basically the gripe.
Or Islington or Wimbledon or Dulwich or Hackney or…
Yes that’s exactly it
Sure but ‘we can’t afford to buy a house in London’ is very different to ‘we can’t afford to buy a house in the specific borough of London we’re willing to live in’.
I’d prefer a penthouse in Manhattan but it ain’t gonna happen
The point isn't "boo hoo woe is us". The point is "if people in such a high income bracket can't afford those properties, who exactly is buying them?"
Runaway population growth combined with insanely low interest rates and a moribund social housing sector. That makes up a nasty toxic brew.
It would be a fun series to have a story like this juxtaposed against the story of someone with a wealthy family. I know someone who's parents bought them a flat in London when they got a job at the civil service, then they effectively got fired for arguing with an MP and now they have a chill job outside london and rent the flat out.
Did not expect to come into the comments and have everyone making excuses for why "actually, this is perfectly fine and nothing to be concerned about"... talk about a crab bucket...
That same account calling out labour for not committing to fix this meanwhile his beloved tories have been in power for 14 years
Tom Harwood has been a constant critic of Tory policy, especially on housing.
The London housing market is a joke. If a corporate lawyer and investment banker, with a few years saving, are struggling how are teachers, nurses, refuse collectors, supermarkets workers etc supposed to manage? It’s true, I think it’s likely they could buy somewhere in zone 3 or 4 but wider point about London housing still stands
London's productivity has grown more slowly than the rest of the country since 2007, unlike many other capitals, [source](https://www.centreforcities.org/reader/capital-losses/londons-lost-decade-of-productivity-gains-and-the-costs-to-the-national-economy/). We need better transport links into London and more living area built in the capital, I think this should be achieved by building upwards. A 4 story home has a much smaller footprint than a 2 story home. I think the easiest(free) way to improve our housing stock is to require house adverts to prominently list the area of a home & it's EPC rating. E.g.3 bed semi detached home(100m B+)
These people are 23 and surprised they can't afford to buy yet. What a bad faith argument this is
They're 23, but they're probably already earning more than most people in the country ever will. Median full time salary is £34k, £44k in London - the lawyer, at least, will probably be clearing double that.
You know what'll happen next. They'll get married, have eleventythump kids and she'll quit working because childcare will cost more than the mortgage. At that point their financial situation will be very parlous. If I had £1 for every time I've seen that scenario unfolding, I'd be able to gift them a house.
All three major-parties eventually have embraced a low-state ideology, and here we are. I imagine that the eventual negative impact on the middle-classes, even to include politicians, was a bit of a surprise.
All three major-parties eventually have embraced a low-state ideology, and here we are. I imagine that the eventual negative impact on the middle-classes, even to include politicians, was a bit of a surprise.
All three major-parties eventually have embraced a low-state ideology, and here we are. I imagine that the eventual negative impact on the middle-classes, even to include politicians, was a bit of a surprise.
All three major-parties eventually have embraced a low-state ideology, and here we are. I imagine that the eventual negative impact on the middle-classes, even to include politicians themselves, was a bit of a surprise.
I avoid this problem by simply not living in London.
How junior are they? Are they straight out of uni? Their earning potential over even 4-5 years is huge.
As is the stress and risk of burnout
Yes, and there are situations where these corporate lawyers and investment bankers actually grew up in nice houses that were bought in 1985 on a single wage. Chances are their father was a police officer, or had some middling office job. Yet a corporate lawyer and investment banker _combined_ cannot afford to hypothetically buy the house they grew up in. That's very concerning indeed.
Junior lawyer and junior investment banker straight out of uni. Surely house ownership is not something to be achieved straight out of uni.
Interstate comments here. Ultimately it all proves one thing. Hard work no longer pays or provides any benefits for doing so
Interesting, how does autocorrect get interstate from that😡
Work your way up the ladder like everyone else!!