Want to buy the average London home? Save more than the average salary every month

Don't waste money on food, you idiot! Image: Getty.

Good morning, Londoners! Isn’t it a lovely day? The sun is out, the air is crisp, Donald Trump hasn’t tweeted for hours and there are the first, tiny hints of spring in the air.

Yeah, well, don’t get too excited, because you’re still utterly fucked.

I mean, obviously that’s always true these days (Trump may not have tweeted yet, but he will; oh, he will). But on this occasion, the specific thing by which you are fucked is our old nemesis, the London housing market.

Let’s turn to the National Housing Federation’s Home Truths report to find out why:

House prices have become so expensive in the capital that buyers hoping to save for a typical deposit over the next four years will need to scrape together at least a staggering £2,300 every month, a new report from the National Housing Federation reveals today.

It might take you a couple of goes to take that one in, so let’s hear it again:

House prices have become so expensive in the capital that buyers hoping to save for a typical deposit over the next four years will need to scrape together at least a staggering £2,300 every month, a new report from the National Housing Federation reveals today.

Still not getting it? Let’s try focusing in on the important bit:

£2,300 every month

Oh. That’s... well, that’s quite a lot really, isn’t it?

Put it this way. The median London salary – the amount earned by the Londoner in the middle of the income distribution – was, as of April 2016, £671 per week, which is just shy of £35,000 a year. Earn that, and you receive a take home pay packet of around £2,241 a month.

So if you, as an average Londoner, save every penny you make – live on a friend’s sofa, walk to work, steal your food, never go out – you will still, at the end of the year, be around £720 short of your savings target. (This is assuming that you don’t have any student debt which, of course, you do.)

Or to put it another way: to save the money requried to buy the average London home, you need to earn more than the average London salary and not spend any of it.

Lazy millennials, blowing all their money on iPods and flat whites instead of pulling themselves up by their bootstraps like what we did. Why can’t they just work harder and stop whining?

The face of the enemy.

And get a bloody pension! Don’t want to be a burden on society do you?

Now, there are all sorts of ways in which we can fisk this one. The NHF represents housing associations: it thus has an interest in talking up the housing crisis, in an attempt to get its members more powers and freedom to address it.

The 2021 deadline is pretty arbitrary. So is the idea that first time buyers would buy as singletons rather than couples. Perhaps the biggest hole of all is the idea that they would buy “the average London home”, now worth (gulp) £563,041, rather than – as is more likely – a shoebox in a shitty area because goddamn it it’s a foot on the ladder isn’t it.

So, no. To become a first-time buyer in London, you do not literally need to be saving £2,300 a month. And to become a first-time buyer you don’t need to do it in London.

Nonetheless the fact that you can get to such a figure, even through some reductio ad absurdum fag packet maths, highlights quite how ludicrous the London housing market has become. It should not be possible, through any conventional mathematics, to come to the conclusion that you need to save more than the average income every month to have a hope of housing security in this or any other city.

Here are some other figures from the Home Truths Report which inspire much the same sort of rage:

  • To buy that average home, under current mortgage rules, you’d need a 20 per cent deposit of around £113,000;
  • Not to mention a household income of £130,000 a year;
  • The cheapest borough in the capital is Barking & Dagenham, where the mean house price is £254,183. That’s 10.1 times the average salary in the borough, or “a whole salary more than any bank is likely to lend to a couple as a mortgage”;
  • The most expensive is Kensington & Chelsea, where the average house price is now less than £40,000 off £2m. Not that it matters, really, but that’s 34.8 times the average salary in the area;
  • The rental value of the average property is now £1,727, which is 61 per cent of the average salary. Which is probably one of the reasons why...
  • Over a third of those claiming housing benefit in London are in work – because their income isn’t high enough to cover their rent.

So, to sum up, we’re all doomed.


Never mind, President Trump will be up and about soon, at which point the complete absence of long-time financial security for Londoners won’t seem like such a big problem in the scheme of things.

Jonn Elledge is the editor of CityMetric. He is on Twitter as @jonnelledge and also has a Facebook page now for some reason.

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Was the decline in Liverpool’s historic population really that unusual?

A view of Liverpool from Birkenhead. Image: Getty.

It is often reported that Liverpool’s population halved after the 1930s. But is this true? Or is it a myth?

Often, it’s simply assumed that it’s true. The end. Indeed, proud Londoner Lord Adonis – a leading proponent of the Liverpool-bypassing High Speed 2 railway, current chair of the National Infrastructure Commission, and generally a very influential person – stood on the stairs in Liverpool Town Hall in 2011 and said:

“The population of Liverpool has nearly halved in the last 50 years.”

This raises two questions. Firstly, did the population of the City of Liverpool really nearly halve in the 50 year period to 2011? That’s easy to check using this University of Portsmouth website – so I did just that (even though I knew he was wrong anyway). In 2011, the population of the City of Liverpool was 466,415. Fifty years earlier, in 1961, it was 737,637, which equates to a 37 per cent drop. Oops!

In fact, the City of Liverpool’s peak population was recorded in the 1931 Census as 846,302. Its lowest subsequent figure was recorded in the 2001 Census as 439,428 – which represents a 48 per cent decline from the peak population, over a 70 year period.

Compare this to the population figures for the similarly sized City of Manchester. Its peak population also recorded in the 1931 Census as 748,729, and its lowest subsequent figure was also recorded in the 2001 Census, as 392,830. This also represents a 48 per cent decline from the peak population, over the same 70 year period.

So, as can be seen here, Liverpool is not a special case at all. Which makes me wonder why it is often singled out or portrayed as exceptional in this regard, in the media and, indeed, by some badly briefed politicians. Even London has a similar story to tell, and it is told rather well in this recent article by a Londoner, for the Museum of London. (Editor’s note: It’s one of mine.)

This leads me onto the second question: where have all those people gone: London? The Moon? Mars?

Well, it turns out that the answer is bit boring and obvious actually: after World War 2, lots of people moved to the suburbs. You know: cars, commuter trains, slum clearance, the Blitz, all that stuff. In other words, Liverpool is just like many other places: after the war, this country experienced a depopulation bonanza.


So what form did this movement to the suburbs take, as far as Liverpool was concerned? Well, people moved and were moved to the suburbs of Greater Liverpool, in what are now the outer boroughs of the city region: Halton, Knowsley, St Helens, Sefton, Wirral. Others moved further, to Cheshire West & Chester, West Lancashire, Warrington, even nearby North Wales, as previously discussed here.

In common with many cities, indeed, Liverpool City Council actually built and owned large several ‘New Town’ council estates, to which they moved tens of thousands of people to from Liverpool’s inner districts: Winsford in Cheshire West (where comedian John Bishop grew up), Runcorn in Halton (where comedian John Bishop also grew up), Skelmersdale in West Lancashire, Kirkby in Knowsley. There is nothing unique or sinister here about Liverpool (apart from comedian John Bishop). This was common practice across the country – Indeed, it was central government policy – and resulted in about 160,000 people being ‘removed’ from the Liverpool local authority area.

Many other people also moved to the nearby suburbs of Greater Liverpool to private housing – another trend reflected across the country. It’s worth acknowledging, however, that cities across the world are subject to a level of ‘churn’ in population, whereby many people move out and many people move in, over time, too.

So how did those prominent images of derelict streets in the inner-city part of the City of Liverpool local authority area come about? For that, you have to blame the last Labour government’s over-zealous ‘Housing Market Renewal Initiative’ (HMRI) disaster – and the over enthusiastic participation of the then-Lib Dem controlled city council. On the promise of ‘free’ money from central government, the latter removed hundreds of people from their homes with a view to demolishing the Victorian terraces, and building new replacements. Many of these houses, in truth, were already fully modernised, owner-occupied houses within viable and longstanding communities, as can be seen here in Voelas Street, one of the famous Welsh Streets of Liverpool:

Voelas Street before HMRI implementation. Image: WelshStreets.co.uk.

The same picture after HMRI implementation Image: WelshStreets.co.uk. 

Nonetheless: the council bought the houses and ‘tinned them up’ ready for demolition. Then the coalition Conservative/Lib Dem government, elected in 2010, pulled the plug on the scheme. 

Fast forward to 2017 and many of the condemned houses have been renovated, in a process which is still ongoing. These are over-subscribed when they come to market, suggesting that the idea was never appropriate for Liverpool on that scale. 

At any rate, it turns out that the Liverpool metropolitan population is pretty much the same as it was at its peak in 1931 (depending where the local borough boundaries are arbitrarily drawn). It just begs the question: why are well educated and supposedly clever people misrepresenting the Liverpool metropolis, in particular, in this way so often? Surely they aren’t stupid are they?


And why are some people so determined to always isolate the City of Liverpool from its hinterland, while London is always described in terms of its whole urban area? It just confuses and undermines what would otherwise often be worthwhile comparisons and discussions. Or, to put it another way: “never, ever, compare apples with larger urban zones”.

In a recent Channel 4 documentary, for example, the well-known and respected journalist Michael Burke directly compared the forecast population growths, by 2039, of the City of Liverpool single local authority area against that of the combined 33 local authority areas of Greater London: 42,722 versus 2.187,708. I mean, what bizarre point is such an inappropriate comparison even trying to make? It is like comparing the projected growth of a normal sized-person’s head with the projected growth of the whole of an obese person, over a protracted period.

Having said all that, there is an important sensible conversation to be had as to why the populations of the Greater Liverpool metropolis and others haven’t grown as fast as maybe should have been the case, whilst, in recent times, the Greater London population has been burgeoning. But constantly pitching it as some sort of rare local apocalypse helps no one.

Dave Mail has declared himself CityMetric’s Liverpool City Region correspondent. He will be updating us on the brave new world of Liverpool City Region, mostly monthly, in ‘E-mail from Liverpool City Region’ and he is on twitter @davemail2017.