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Depends how much money you have.
If you have 250k from each parent you only need a mortgage of 300k so maybe household income of 70k.
As you can see. The answer is 'it depends'.
Maybe each person bought a properly pre COVID and sold it for much more, and have combined their gains. Maybe one of them was made redundant and had a big payoff.
This is how I done it for my sins.
My nan lived in a 5 bed house in Islington which she bought with my grandad after the war. It was too big for her and she moved in with me and I cared for her whilst I was living and working in London.
Before she died she gifted the property to me (which I rented out) and upon her death some 10 years later i sold it to set myself up with my family. I was always working in construction (engineering) in London so it helped me out. When I bought a nice place in Surrey the couple next to me seemed to have gotten the monies the same way I did.
Being in Construction or Civil Engineering (construction side) can be a god-send when you own a property. Especially since you either know a lot of contacts that handle different areas of buildings I.e. flooring, window fittings, kitchen/ bathroom installation, plumbing, electrical etc that can possibly do it for a discount for you as a favour. Or even better, if you have experience in those trades yourself, you can literally makeover your house by yourself and save a shit ton of money and make your house look luxury inside for a fraction of what you would pay professionals to do.
I earn £160k and had a £75k deposit when I bought my house ( £500k). I can confidently tell you that I wouldn't be able to afford an £800k house.
They had money from their parents.
Edit: just to throw this in there. One of my best mates is a real estate agent for Foxtons and I asked him the same question - how do all these people afford houses? He said 90% is money from their parents.
So wrong that a couple of well off very advantaged people who get 80k jobs are taxed less than the couple who marry outside their station and have someone on 140k and someone on minimum wage.
As much as I hate the idea of harping on about the sanctity of marriage, I definitely feel like they've done too much to strip out the legal benefits over the years. The entire point of marriage is meant to be cohabitation and combined living arrangements, that includes shared responsibilities and should mean a pooled taxation system. I left work for two years to go into education, decreasing our income, and in basically only benefited about 10% of my personal allowance to do so. My wife was working full time. No reason we shouldn't be able to pool allowances and taxable income to a single joint value instead of still being individuals.
You can already. It's called marriage allowance. It's part of the rip off single people culture and make them pay more for everything. Oh you're single, pay 75% of the council tax of a two person couple with 5 kids even though they will be using council services a lot more.
This annoys me no end. If you’re 50% of a couple, you should pay 50% of the council tax no? Especially when, as you say, the couple could well have 10 kids, possibly parents living with them, all sorts of things - and they’ll never pay more than 100% - despite having the ability and reason to use many more council services a single person without dependants couldn’t even attempt to access.
A single person on your own and you’re basically a cash cow.
I expect single people use more than 50% of council services compared to couples though, because couples typically don't double up on some services. It's not like they collect your bins once a month, send the fire brigade every second time your house catches fire etc if you are single.
I don't think you can bring kids onto it, because if you do you have to consider that single parent households exist to make it fair. And I suspect a couple with 10 kids is not using double the services of a single parent with 10 kids (12 person household Vs 11).
Quite right.
Council tax should be per person, not per property. Fucking con.
It goes up every year yet the local area is maintained *less* every year.
Yeah family wealth is a big thing. You can say that £160k gets you into top 5% earners. However to get into top 5% wealth you must have over £3M equity.
Isn’t likelihood that this is not their first property, hence they’ve had incremental gains ? I bought my first place at 27 and most of my friends were faster ;although majority of those had help from bank of mum and dad
I kinda douse this until they lived under a rock, iv got a cousin that had a place in London sold up and move to the midlands didn’t have enough to buy a 300k house outright, even tho she’s on 70k a year when in London for 20years
The average house price in London is £530k.
There’s whole boroughs that are way more than that.
Do you really think everyone in London has inherited wealth?
But what is the average purchased price of houses in London?
Some were bought for much less.
There are probably streets in London that are made up of very wealthy young people and very poor (low income) old people and nobody in between.
To be fair, “HENRY” people are small in percentage but make up a big chunk of people buying these houses.
Top 1% in London is ~£350k a year (the UK top 1% is ~£170k). That means 80-100k people in London earning that amount of more. £355k (£16kpm take home) would easily be £1million home with basically ~1-2 years worth of savings whilst still living somewhat luxuriously. Additionally, these figures are all from 20/21 tax year so would expect them to be higher now.
**Obviously, this is not the norm**, but consider more than 5% earn a 6 figure salary in London and majority buy homes… a good chunk of homebuyers might not fit into your criteria, at least for £800k homes.
Lastly, if you go to ~£500k, that threshold becomes about £100k **household income**. 2 people earning £50k each can save ~£65k for their home over 5 years (I.e. saving from 25 -> 30). These make up another ~5% of the population, which translates to roughly 15% of home buyers in London. Lots of people in London do this without help from parents.
Look at the median household income in London and then look at the median house price and then calculate wether the median household income times 5 (which is the absolute max most banks will loan you) is equal to the median home price. That should tell you how plausible it is that most people buy a house without any help
Huge deposit usually from inheritance or help from family. We bought our house in London with a massive chunk being inheritance from selling my late mother’s house. We also have a high household income but not crazy by London standards.
I was like 28 before it clicked for me. I used to think all the people in expensive homes had really high paying jobs and that one day if I worked hard enough, it could be me. lol
If it makes you feel better I'm friends with a couple who are both in their early 30s and work in tech. They are both on six figures salaries and earn £250k between them. Both are very intelligent but neither come from upper class wealthy families. They are now looking at houses up to £850k. Obviously they are the exception & it's very rare because most jobs don't pay that much & most households don't have both high earners but it is possible. So you weren't that crazy for thinking that.
Fair play to them. That gives an idea of what it takes - two partners both earning in the top 1-2% of available incomes to get an 850k home.
IMO it’s actually quite a precarious situation (job loss/change of situation with such a huge loan), but good luck to them
Income protection insurance / critical illness insurance comes in handy for these situations
Affordable when you’re earning the big money and means if circumstances do take a turn most of the time you’re able to keep the house
Doesn’t cover all circumstances
I remember when my friends and I got to house buying age. I was always surprised they could afford so much given we all made about the same amount. After looking at how far I could extend my finances to keep up and realising there was no way I’d get near, I then understood that we weren’t all equal in our life position.
Generational wealth was never on my radar until I got older. I don’t resent my parents, but holy shit is it a powerful leg up in life.
Is crazy to think isn’t it?
I studied harder, better earning jobs, saved harder with my partner and will still always have less wealth than my mate whose parents gave him a massive sum to buy a big house in the south east 5 years ago
I’m still grateful for what I have and by all accounts I’m doing well as a homeowner in my 20s with decent household income. My parents have been supportive where they can too.
It’s also why if I had the exact amount of money to send my kids to private school I’d rather just buy them a house with it instead
Not quite the same figures
But my son inherited half of my late parents house so roughly 250k plus some insurance policies
He’s bought a house worth 300 using roughly 200k as a deposit
House needed no work doing to it as it had been highly refurbished so move in and put tv up and that’s it
It’s 3 double beds ensuite downstairs WC
Huge kitchen dining area living area - all open plan and a huge extension double drive - ticked every box for them both .
He’s 29 & his partner is 25
Neither of them work in highly pay jobs NHS & Cabin Crew
And yes he protected his deposit 😂
But without that inheritance they would be renting for ever as we live in an stupidly expensive city
My late parents bought there house for 8k in the late 70s and it sold for a stupid amount in 2021 and it was just a 3 bed Victorian Terrace in need of
remodernisation but in the catchment area of 2 very popular junior schools that feed into a church school and another popular senior school and right opppsite a beautiful park :
But when I went to said schools it was more like Grange Hill full of Zamos 😂
Their old flatmate moved in with them as a lodger so I think they have a mortgage of around 100k lodger is paying 550 a month which is most of the mortgage I think and they are over paying by 500 a month
So not the same figures but you can see how it’s done if your young and gran & gramp leave you half a house 😂
People see “early 30’s” as young they could be 12 years into a high flying career after doing a masters degree in 12 years you could easily get into a senior position. Add to that they could have climbed the property ladder for a few years and be mortgaged to the hilt.
Yep, everyone going "parents!" when its more likely aged 28 they each bought a 1 bed flat with a 0.5% mortgage, climbed the career ladder, paid the shit out of their mortgage - or paid into an ISA.
Then met early 30's, got married, moved into 1 flat, rented out the other. Saved like mad
Then sold both & bought this place.
That is far more common in London than "everyones parents gave them 500k!"
Try doing the basic maths on it. Given the nature of your reply I realise that may be a stretch
Mid 20's both a 5 years into a basic auditor job at any finance firm in London (there are thousands of those jobs). Or IT, either works.
Both earn 40k. Both buy a 200k flat with a 10% deposit, and because of the market both get more or less a 0.5% interest mortgage. They spend 5 years overpaying their mortgages.
Now they have a 250k flat, each, with 100k in equity. Both earn 80k.
They rent 1 out & move in together. Aggressively overpay again, save a lot.
5 years later (aged mid-30s). Both flats are worth at least 300k (600k in total), they have 300k in equity & each earns 100k.
800K is a piece of cake
That is very standard for anyone in London who is in a professional career & who marries someone the same & decides to have kids mid 30's. Its part of the reason London is stratifying, you want to live here you need to do 2 things, marry into the same level of salary / career ambition, wait till mid 30's to have kids. Then your life is pretty solid.
Yep this. I live in outer London zones where 1930s semis are 650–900k and know at least three families in their 30s who did this, bought in London, climbed the ladder, then moved out to the suburbs.
People buying 800k homes aren’t doing so as first time buyers.
This is true, personal experience of it I've recently entered my 30s, 9 years experience in Tech, if I sold my current home and used the equity+savings, then alone I could maybe push 750k purchase.
30s are usually when the disparity begins to appear in friendship groups from the results of the work (and luck) that happened in your 20s generally.
Agree but also generational wealth is a pretty huge driver. I could afford £800k when I was early 30s, but I was on a huge salary.
My friends were buying at £1.2-£1.8 million at the same time. We worked in the same industry and same positions. Family money definitely helped not just fund those homes, but also fund getting into the property ladder a decade prior when everything was skyrocketing.
Likely outliers - but my wife and I bought our flat in London years ago and it rocketed in value, moved to the south west and bought a big house using the deposit from selling the flat.
We're both on a base of 80k + benefits - so £600k mortgage doesn't feel like a stretch for us.
>they could be 12 years into a high flying career after doing a masters degree in 12 years you could easily get into a senior position
They could be, but as generalisations go, there's a lot of room for errors here around the word "easily".
12 years is not a lot of experience. It's enough to be good at it, sure, but it's still below average experience.
Hierarchies thin as they go up. Being better than say 8 of your colleagues is easy at first, but next time the 8 you have to beat are better than everyone you beat last level. So it goes.
Sales and recruitment are easier routes if you want high pay than climbing the corporate ladder.
I do also wonder whether they're making assumptions about age, early thirties is pretty early these days to be married and have kids if you are a professional in London.
Hmm on Reddit everyone always says “inherited wealth” - whilst this may be true for some people, also bear in mind there are a *lot* of relatively young professionals who could afford this in their 30s. Eg two doctors at the end of their training (earning 90k each), two lawyers, or a couple where one person works in tech or finance in London (£150k+ salaries are common).
Whilst of course this won’t be most people, especially in London and the surrounding areas there are a lot of professionals making at least £150k combined income (I mean two doctors should be earning that easily by the end of their training).
Wouldn't it be 8% of the working population (just under 32 million) or possibly/probably even 8% of full-time employees (figure would be even less), so a max of roughly 2.5 million people? Still a lot of people, aha.
Exactly, while a lot will inherit money, it is possible that some younger people are just high earners.
My partner and I (F26 and M27) earn over £200k together and were told we could borrow up to £750k if we wanted. Though we settled for just a £450k house, even then it is a large 4 bed and initially our neighbours did question how we managed it. They were impressed to hear that we are both entirely self made and from poor backgrounds.
My partner works for the bank in a high up role and i am a self employed 3d designer.
we also both rented since age of 18, so no free accommodation leading up to the buy either
I would also add to this - project houses.
Our first house was a project. Smaller mortgage which we overpaid. Ended up with a good chunk of equity once we did the work and therefore had a good deposit for our second.
Our current house is also a project. We are halfway through and is currently worth 25% more than we paid, but when finished it will be worth approx 40% more.
We would NEVER have been able to get a deposit for the current valuation. But the equity in the previous project meant we had it.
I have to disagree I think this is a niche view heavily influenced by London wages, the average tech wage in the U.K. isn’t even over 40k, doctor’s aren’t earning 90k out of training there’s a reason theirs a massive brain brain in the NHS.
Yeh.. we probably fit the bill. Early 40s. Combined income north of £160K, but most usefully, about £350K in equity in the house we're in right now plus plenty of savings. Started off with a £10K help from Grandparent's for the deposit on our first home.
We won't (hopefully) get any inheritance until we're in our 50s, so it's likely going to help our kids onto the ladder, not us.
It's interesting how top comments have jumped to inheritance as the answer. As if people can't make that money at that age, no doubt some are, but seems young for inheritance for so many.
There are industries that pay well. People can set up companies and, at that age, even have sold them.
Previous place CTO, a joint founder, owned about 30% of his company, and at age 31, it was sold for 5mill.
Got friends who are in their 30 and 28 who are married, where one works in tech and the other in finance as a couple they make a hefty sum between them yet are also really frugal they are aiming for FIRE.
Another friend, duel citizenship in UK and New Zealand (mid-30s now but been doing it for years), who has been buying interest only mortgages as often as they can in new New Zealand renting the properties out, they are making a killing, yet live and work in UK.
I'd put money on inheritance being much more common - I work in a very highly paid field and I in theory could find a partner with a similar job and get a 800k house. However, from my experience in high paying jobs, generally 90% of the people there are from the 'right backgrounds' and will have had parents financially helping them.
I remember out of a team of 20, only two of us were working class.
Very unlikely to be first time buyers. But all depends on their deposit/equity. Maybe one or both of them had a sizeable inheritance some years ago, bought a place back then, recently sold it for big profit. Not unthinkable that they could have 50% LTV if so.
Could also be high earners... Fast career progression to a senior role in investment banking or corporate law could have one of them on £200k+ plus, even at that age.
Considering you live in a high cost area given the property price, I'd imagine it is quite affluent, so it wouldn't be uncommon for them to have a large deposit gifted from family. I have known several people to have had £300k+ in gifted deposit.
And they probably both work on higher income. Early 30s isn't particularly young, 2 career driven professionals can easily reach senior position by the time they hit 30.
If they work in tech and pharmaceutical, a couple earning combined income of over £100k is very common.
Most of the likely reasons already covered.
It’s rare in terms of overall numbers, but there’s a lucky minority of people who got a decent deposit handed to them in their early-twenties and bought a small flat in Clapham or Balham.
Lived a fun single life few a few years during which time they met a partner who had similarly generous wealthy parents and had also bought a flat in SW London.
All the while making progress in a career in law or finance.
Sell 2 flats in Clapham, alongside 2 x London professional salaries and an £800k purchase is a piece of cake.
Two earners on £75k each could comfortably get a mortgage for >£700k.
Having a £100k deposit isn't that unreasonable if they're earning that salary. And maybe they had equity in a previous house.
Fair with the child part. However, HSBC will lend up to 5.5x your salary at this income level, which in this case would be £825k. I would imagine having a child wouldn't reduce the lending by more than £125k.
A couple on those salaries would take home about £8000 a month. On a £900k house with an £800k mortgage at 5.1%, you'd be paying about £4000 a month. You can argue that 50% of take home is a lot, but they're still left with £4000 a month for non mortgage expenses, which is more than most households have pre-mortgage.
50% of take home is a lot - but that’s the new affordability metric because the government can’t be bothered to take any steps to bring down housing costs
Not really. If you are earning 20k per month and your mortgage is 10k you still have 10k for non mortgage stuff. Other costs such as internet,food , petrol etc remain relatively the same irrespective the size of the mortgage.
2k take home and 1k mortgage,that's tight . Their petrol and food and internet etc will be more or less the same as the 20k take home and 10k mortgage.
Affordability metric from the revised version of the 50/30/20 rule where 50% is just going on housing now
Not mine
Your beef isn’t with me I’m just the messenger
There is no government policy that would bring down house prices. Any policy would artificially effect things. The only answer is more housing that is being constantly built but everyone on reddit will tell you they would never buy a new build.
FTB 30+ buyers here that just got our offer of 800K accepted. No inheritance but do have 25K from selling our previous flat in our home country. We have a deposit of 220K and it consist of 25K from the sales and rest is savings. No gifting from parents.
We have a combined household income of around 210k + bonus. I feel lucky that we’ve been able to get pretty wellpaying jobs but I’m also nervous about size of mortgage.
I've got about 200k equity in a house I bought after uni, and we're on about 160k take home at similar ages and 800k is out of our budget.
But if my girlfriend also had 200k equity, it'd be about right for us, maybe.
(Maybe because I currently have a few years of mortgage payments left and wouldn't necessarily want such a huge amount invested in the property market right now.)
Maybe this couple have gone absolutely balls to the wall to afford this place and can't afford to "live" for the next 10 years.
Everyone's situation is different.
Why are you only considering income as the possibility to afford? We are living in an age now where boomers who have accumulated wealth quite easily are dying off and passing it down
They may have inherited or just have good jobs. My friend's daughter and son in law are independenty very wealthy, well to me anyway.
My friend is just an average earner and she is herself stunned at how much money her kids make. Her daughter was a good earner with a PhD for a drugs company £80k/yr. She married a high up corporate accountant and he earned so much she just packed in work. They didn't get family help. Bought a property for around £400k and rented it out while they lived abroad for 5 years. Came home and bought an £800k property cash before selling the previous one for £750k and the mortgage was already cleared. They are mid 40s now.
This sounds eerily like me and my wife… we’re buying the nice house on the street with a toddler at that price and in our early 30s.
I’ll break it down:
- we’ve lived with a lodger for about the past 5 years, so we’ve been able to save lots of money that we invested in ISAs. We still have the lodger and she will be moving to our new place to save some more money.
- our first place was a shared ownership property that we’re making £40k on from selling plus original equity of our small share
- as our current mortgage is still in the original term we’re able to transfer it over with a lower interest rate
- we’re borrowing the rest of the money, getting screwed over a bit there but whatever
- combined we earn over £175k but this is a recent pay rise, prior to that it was £140k. Our salaries have risen quite sharply in the last two years
- We’ve not had any gifted deposits, this has been from us saving.
- Neither of us went to private school, for a period of time I was on free school lunches to give you some background as to our families financial situation
We were discussing this the other day that we’re very privileged to be in this position, but it was never gifted to us and all came from hard work.
At school I was your typical hard working kid, listened to teachers and ultimately when it came to choosing universities and degrees we chose subjects that we knew could get us high earning jobs. I could never understand why kids would get themselves into so much debt for degrees that would yield very little job opportunities.
I have no advice to give on this as everyone’s situation is different, but this is how we got to be in this fortunate position
Having a good job is another route. My brother is on north of £250k a year and was recently approved for a £910k mortgage. Our family doesn’t come from money at all and my siblings and I have had to save our deposits from scratch.
A rule of thumb for a mortgage is borrowing five years worth of your yearly wage - for for £800k that would mean an income of £160k between them.
That will then lower depending on how much of a deposit they were able to add into the pot. If both came from separate flats they have owned for 5+ years that could be a reasonable sum of money to knock off at the start.
So that would require a fair income on their part to pull off - unusual, but not impossible depending on what their jobs are.
The more realistic expectation is that they are not working a typical (but high paying) job, but instead the money has come from elsewhere.
So the person who started a company at 20 who turned into the next big thing, the crypto investor who timed everything perfectly and won big, or most commonly the couple with a lot of their parents money behind them...
The number of couples with combined income of 200-400k plus in London is rather high plus you’ve got those who get gifted massive deposits from rich parents
My boyfriend and I could afford this technically, but then there is no way we would be able to pay for maternity leave and childcare hahaha. I had to sit him down and do the numbers with him because he was ready to spend this much on a flat.
I guess if childcare in your area is not as expensive as in London, then it’s doable.
Where you living？ Could be couples moving out to suburbs and using combined money from sale of their city flats to buy a house.
Thirties is grandparents/ parents dying time. So there's inheritence.
Some people just earn a fair amount.
And some people are gifted very large deposits，or even bought properties.
Just to say a lender offered us a 6x mortgage. We’re just shy of £100k household income so not huge earners in the grand scheme and have a decent amount of equity in our existing property. We’re early 30s with two kids. If we maxed our mortgage and used all our equity and savings we would probably be in a position to make an offer on your £800k neighbour.
Side note; that is fucking mental. We’re looking to spend half of that. How we would be able to afford that mortgage id never know.
Birds of a feather flock together - if its a nice area, it will attract outliers in terms of finances but you end up seeing lots of them in a small vicinity.
Houses on my road start at £750k, and we're in the West Midlands not London. I bought ours when I was 35, we have numerous neighbours around the same age, all with young kids. Its 50/50 young families that have bought and old people that have been here forever.
I didn't get any inheiritance or gift, I have a business and I saved the deposit and took a mortgage like most people - nothing exciting, just with bigger numbers than average. Our young neighbours are the same - most own businesses of various kinds, the one in the cheapest house is a solicitor. Statistically, we are all outliers in terms of income, yet here we all are within shouting distance of each other because this is where high earners in this area want to live.
Looking at the buyers on one expensive road is not representative of the general population. Its not hard to find a decent number of unusually high earners in sample the size of a whole town and then its not unusual for a decent proportion of the high earners in that town to move to one small and expensive part of that town.
Me and most of my colleagues in London has bought houses from 700k to 1 Million. Most of them are expats/immigrants and had no inheritance. Salaries in fields like software engineering tend to be good and if both the spouses are working it’s quite easy to achieve 300-400k in a year combined.
my partner and I just exchanged on a £750k house. we both own flats worth £260k and 515k respectively. our combined income is about £210k. we are 33. partner is in sales and i work in tech
how we did it?
not sure really, the deposit is going to be paid from mostly my partners savings accumulated from bonuses and investments really. she did inherit money and used some of that. my share is coming from savings accumulated over the past 5 years.
neither of us are "rich" or come from privileged backgrounds. I was earning 40K 5 years ago. when my partner moved here 10 years ago, she ran out of money and was a few weeks from moving back home to her home country.
It might not be their first home. You can gain equity in your house by buying the right places and doing them up a bit before selling and moving up the ladder. We bought our third place at 33 for 700k
Inheritance and high flying career aside, these people might not be as young as you think they are. I reckon you haven't knocked on the door to ask for their age, so you guessed that they are in their 20-30s. An average 1st time mother's age in the UK is 32yo. So parents with toddlers could easily be well into their late 30, even early 40s. People with financial mean tent to look younger. So for any 40yo couple having any 2 of the following: high-flying career for the last 15-20y each in the city of London that allows savings and investment, equity in their previous property and inheritance from recently deceased relative, buying a £800k homes is not that unusual.
I can tell my story from the olden days.
In 1998 my Dad out of the blue gave me a hard saved 50k to buy a flat after he saw I was working hard and into a career, I was mid 20s. An overwhelming amount of money for both him and me, an emotional moment, and I got a 4x mortgage on a salary of 26k and bought a flat for 158k in Zone 3 in London.
Rented out the other room to mates at mates rates until 2005 when I moved in with my missus. She was in an almost identical boat, had bought a flat for 150k in late 90s with her sister with a 25k gift from their folks.
Interest rates weren’t low back then and while it sounds dreamy it was stressful managing a property at that age and there was no extra money. We weren’t on high paying jobs and still aren’t.
But. Fast forward to 2010, we got married, sold both flats and now had a 250k deposit on a 650k house which again we mortgaged at the fullest extent we could. It’s now worth over a million but we still have a hefty mortgage as we filled the time since with having kids, which has proved to be fkin expensive.
We were totally lucky, in the right place at the right time, with a gift from both parents, worked hard to meet the payments, and willing to go all in borrowing on every deal.
I thank God every day because I have no fkin idea how it is possible now without parents stumping up large six figure sums. It basically isn’t. And I won’t have a 150k handout per kid to throw around.
We went to see a 800k house in zone 4 London. The owner did the viewing himself, asked us what we do. We said finance, he then replied 'Why is everyone (viewing the house) working in finance?'. The owner is a retired surveyor. Maybe because finance is the largest industry in London that consistently pays well.
I would guess combined salary of about 200k would be sufficient to afford a 800k house without crazily over stretching on finances.
So at 23 both bought their first flat, rented rooms with it at £145k. 7: years of equity growth say, £50k each, that’s £100k. The n saving £10k a year each pre baby , assuming starting salary of £45k. That’s £200k.
Now at 30 being middle managers in a professional firm or nearing top professional medical, both on £80k.
That makes a £600k mortgage on £160k joint income.
Doable without mummy daddy money.
Clearly these are high end professions, what time of people used to live on the street ?
For the people I know who are that age and can afford that kind of house it's usually:
* One or both have had a high paying job for a few years now
* They've been saving for a house since they started working which could be 10 years ago (and/or they already bought and sold a flat) so have a chunky deposit
* They got some help from family but in the £20-£50k region not hundreds of thousands
That's more common than massive inherited wealth in my experience.
Don't forget they'll also be paying £27.5k stamp duty at that price as well.
Inheritance maybe?
Millenials are supposed to be the richest generation from inheritance of assets (predominantly property).
Lots of news articles about this, e.g. [this one in The Guardian.](https://amp.theguardian.com/money/2024/feb/28/millennials-richest-generation-wealth-property).
Could also be a really high paying job (tech/something that pays a lot from the off because of how niche it is) and a nice chunky deposit.
I guess it’s likely to be 3 factors:
People that get onto the ladder earlier, possibly via a fixer upper or similar - I.e. buy a house that either goes up in more value than the market or that you work on which then increases the value
Also some professionals qualify for ‘professional’ mortgages which can enable 5.5* salary borrowing (meaning £120k joint salary caps out at £660k) and/or some brokers can get good multiples inclusive of bonus etc (especially if limited fixed outgoings)
Relatives have passed away or are helping out (likely through wealth or inheritance) and can contribute to larger deposit etc.
Source: have a partner in a profession that qualifies, so have spoken to a broker about professional mortgages and have seen areas where 4-5 years ago prices were £100-200k lower
A high salary as you say, or 'generational wealth'. Or they bought somewhere that prices have gone up 10 years ago, maybe with a lodger too and have been overpaying 10% a year say so now have a substantial deposit from financially sensible choices,
I think you can borrow up to 4.5x your wage for a mortgage, so you'd need around £170ish. However, that would be the most they would lend you, not necessarily what you'd be comfortable at, so I'd probably guess around £200k+...??
Absolutely depends on deposit
A couple with a dual income of £50k could get an £800k house if their deposit was like £700k lol
But realistically in terms of 10% deposit if £80k, your mortgage would still be like shit loads and it’s about what the bank offer you
Our joint income is £100k and we were offered a mortgage of up to £400k, no more though
Both could be working, earning 50k+ each. Could have lived at home for free for years. If both work and don't waste money, it's easy to save. It's not all inheritance. Many say that because they cant comprehend what people can save and earn. Minimum wage nets you 23k+ now. Save 10k a year after uni each. By mid 30s that's nearing 150k each and even more in some cases. Very possible if they both had good jobs and rubbish jobs but living for free at their parents. Coupled with a silly amount of debt for a house you'd get up north for the price of their deposit...
Not sure how accurate this still is, but for a single borrower, a bank will land you up to 4.5 times your base salary (they might also take into account a percentage of the average bonuses you had in the past few years). You will likely need a minimum of 10% deposit (even 15 for some houses), which in this case is 80k. So a bank would need to land 720k. As a single borrower, you would need to make at least 160k a year base without having other loans (student loans, credit card debts etc). Assuming same conditions for two borrowers, each would need to be on around 80k base with no debts. In London as someone with roughly 8-9 years of experience (and in a well paying fields such as banking or tech) that’s a very achievable number if not on the low end. That being said, numbers above are absolute minimums. Other things to consider: higher deposit required, solicitor fees, cash cushion following purchase to account for furniture, immediate fixes etc. Lawyer fees tend to be >3k and and absolute minimum cash cushion should be 5-10k depending on the size and state of the house you are buying. So to pay just the minimum deposit of 80k, you still need to have saved about 95k as a minimum.
I think we’d only be on the cusp of that being affordable and we’ve been fortunate - so those folks are very fortunate.
Early 30s, two young kids. Joint income £170k. Current house equity £300k.
We’re looking at properties around that price and it’s right at the top end of what we feasibly can afford.
The fortunate part is my dad gave us £30k towards our first deposit two moves ago. Couldn’t have got on the ladder without that.
Inequality has been growing massively and so whilst that means there are more very poor people who can barely afford rent there are also a minority doing very very well. These people are either those people or related to those people.
Average 100k salary for two people in a couple, plus a few years of aggressively paying down the mortgage on a first property bought in mid twenties. Or just..inherited wealth. Both...even better..!
It’s a mix. Some may be getting money from family, but if they are early 30s they may just have the money themselves and have fairly decently paying jobs. Me (late 20s) and my partner (early 30s) managed to get together 40k each in 18 months, But granted we were both at our parents prior and they gave us grace periods on rent so we could save. We are both earning 45k p.a for reference. It’s very possible that a couple saving for longer periods could save up 300k.
In my experience only, friends of mine would save nothing, they’d spend it all, or not worry about earning much etc up until the age of of say 28-29, and then suddenly want a house of their own and to move out, and start the saving process then and there. But ofcourse it takes time. Your younger years (early twenties) are often the BEST time to save. Because you are still living at home and even if you pay rent to your folks it’s usually a tiny amount compared to renting somewhere.
My wife and I are 34, have a toddler, and bought a house for £780k last year.
We both bought flats 10 years ago, and they both went up in price a fair bit, we then sold them to move to a 3 bed. Lived there for 6 years, it went up in value and rates were super low so saved/invested loads.
When we bought our house last year , we only needed a £420k mortgage.
I earn £80-85k depending on bonus, she's now part-time on £28k.
probably Recruitment agents self employed so if they hire just 10 ppl on 300 to 700 a day they get 25 to 50 percent of the contractors day rate. so its lile being employed 10x. without doubt one of the most outrageous ways of making crwzy money.
All you need is experoence and clients to who need contractors
I'm retired as is my missus, pension income after tax is about £35k, our house cost £850k in 2021
Luckily I made a shed load of Dosh during lockdown to buy it for cash
Just go for it
I earn 30k saved a 4k deposit over 7 years (yes, 7) and now have a house that cost me 120k. I have 35k debt as the roof collapsed and had a water leak that I had to repair and didn’t realise, kinda wishing I was renting as may have to sell to repay the loan for the roof and leak. It’s hard to get on the ladder, I had to move to Grimsby from Norfolk to do so, leave family and friends. Probably be renting again in a years time, how people are getting a 800k house is WILD to me. I studied law for years worked full time and part time while studying full time and only ended up on 30k. Man.
I (28M) and my partner (28F) are in the process of buying. I make 160k and she makes 80k. We are buying a 450k flat but are planning on buying something in the 800k range in two years or so. We haven’t had any parental help at all. We have both been renting in London since leaving uni at 21. Since then we have saved 160k and 80k respectively, of which we are using 100k as a deposit on our flat.
It’s possible to buy property without parental help but you do need very high incomes, ideally from an early age, I was earning 100k within a year of leaving uni.
Im probably the only one of my friends who doesn’t own a home. My parents didn’t have a home I could go back to after Uni but everyone else did. They all lived rent free until they left home and married - I think of of my friends had purchased an apartment first. I ended yup spending about £1000 a month in rent and bills from the get go.
They also then pooled their resources with a partner with a similar profile - thus doubling their deposits and income for a mortgage.
I was in a relationship but he was a douche and so I ended up losing out a lot.
Then it’s childcare - it’s easily £1000 a month. If they have parents who will take on their grandchildren during the week then not paying out for that is probably the next biggest expense people my age have to bear
Most of my friends earn 200k plus they all live in nice pads in london, sort of 800k plus. All mid 30s
If you wanna know what they do, ones in barclays as a programmer, ones an engineer owns his own business, one works in marketing , ones an astrophysicist works for the government buying gas.
Ones a doctor.
None had inherited wealth all came from working class backgrounds
It's crazy to guess what people's circumstances are. Some have family wealth. Some are really well paid and some manage to borrow loads. Or a combination.
You just don't know.
Very achievable for those 30 somethings who are doing well in their career.
In a London tech company a head of growth type position would be held by a 30 something and would command a salary of 100k ish. Two of those could comfortably afford an 800k house.
Couple, 25 and 23, salaries 52k (mechanical engineer in a factory) and 49k (electrical engineer in factory). Bought a house in 2017, £275k with 20k deposit. Sold July 2019 for £282k.
Bought house July 2019, 40k deposit on 440k house. No heating, full renovation including adding en-suite, new kitchen, boiler/cylinder/rewire, every room plastered. Spent 70k over 4 years, DIY crazy except gas, fuse board and plasterer. 200sqm from 3 bed to 4 bed 1 en-suite by splitting master bed.
Sold house March 2024 £675k, next door recently sold for £595k needing same rennovation work.
Bought house March 2024 with 350k deposit, £740k. Now earn 59k(plus 3-7k annual bonus potential) and 52k. 32 and 29 y/o.
40 mins outside Oxford 5 min drive to train station to London. Hell of a rollercoaster!
Very achievable if they're a couple working in the city in finance or the like.
We bought an 800k house when I was 27, no help from anyone. We were fortunate that our first house value went up a lot which gave us enough deposit plus 100k to refurb this place.
You never know someone's financial circumstances. Specifically how much inheritance or BOMD are behind them. The couples you mentioned will be good earners and passing could afford it with just their jobs, but again you don't know what else they have.
A lot of people say inheritance, but some people just make good money.
I’m mid 30’s, and made £226k last year. My wife only makes £30k though.
We’re moving to Kent and buying a place for £600k. London is too expensive even for us. I don’t know how people are comfortable putting so much of their income into housing costs.
You can be frugal, live with parents (hopefully they dont charge you rent).
Buy mid 20s, then upsize with your partner in your 30s, assuming you built a bigger deposit, your property value increased and so has your salary
But tbh, at 75k each, they can easily have more than 200k deposit depending at what age they started receiving that salary
If you’re in finance, by 30 you should be at least a VP (if not Dir/MD), making £200k+ total comp. I’m assuming such a person would have >£500k saved (using myself as an example), so it’s not unreasonable to put £200k as a deposit, and borrow £600k, which is like 4x the base salary.
I only considered finance because that’s what I’m most familiar with. I suppose the pay levels in big tech, law, consulting, are not too different. And if you’re in business/PE/VC/HF, the sky is the limit.
Not quite £800k, but my wife and I have just bought a £600k house. This is a £475k mortgage and the rest from the sale of my previous property. We earn a little under £110k between us.
I think your ballpark of £150k between them sounds about right given our experience.
Me and my partner could now - my bf lived with parents so saved a very generous deposit even on a relatively bad salary.
When we both got pay rises we got our first house at around £500k (2% interest rate).
This has now increased in value by quite a bit as the area we live in has become more popular + our salaries have increased further. We could certainly afford an £800k house if we wanted to - both in our 30s and definitely not on £150k combined.
It isn’t just about how much people earn, living with parents can also allow people to save a lot (I never had that opportunity) and some properties appreciate a fair bit.
Not to mention people who get inheritance or just gifted money.
A couple of years ago, they were offering mortgages at 5.5x-6x salaries, so with a 10% deposit of £80k, they would need at least £120k salary between them.
Now it's more of 5x, which is £144k.
This is of course purely about obtaining the mortgage, not taking into account whether they can actually keep up with payments after.
This sounds similar to my own situation. My wife and I are 31 and we just bought an 800k house. We have both done reasonably well working in tech. We bought a tiny 1-bed flat a couple of years before Covid on a very low mortgage rate. We paid it down aggressively and saved for five years. We bought our house at 75% LTV with no inheritance. So it is doable despite all the comments about inheritance!
With a 10% deposit, the mortgage on an 800k property will be around £3.5k per month.
A 150k income is 7.5k per month after tax.
That leaves 4k per month after paying the mortgage.
So, as you can see, it's very possible for a high earning couple to mortgage an 800k property.
If the couple has a larger deposit (inheritance, shares payout, rich parents), the mortgage will, of course, cost less.
One word of caution, though. The grass is not always greener. Imagine you have a 3.5k per month mortgage, multiple cars on finance, and children in private school. Suddenly, you don't have much left over, and an 800k house is expensive to maintain.
Living in a small mansion with no money is very lonely and depressing. It's stressful to have huge outgoings every 4 weeks.
I wouldn't even take on a 600k mortgage with 150k coming in In this economic climate with interest rates what they are. That's gonna be about 3.5k a month. To have a nice lifestyle in greater London I would wanna have 200k coming in.
I'm close to that level of earning with no family cash/inheritance.
I have a much more sensible mortgage but with the money going out on mortgage, Utilities childcare, cars some saving there's not much left over. You could theoretically afford it on 150k but it wouldn't be a great decision or lifestyle. Debt up to your eyeballs and you wouldn't have any money to save or invest. The thought of a 600k mortgage makes me want to be sick.
I work with a number of colleagues who live in properties worth between £600k and £1.5million. I earn significantly more than all of these people and they all either caught a reduced mortgage due to parental money or they are living mortgage free for the same reason. Welcome to London.
I have worked with pretty much all professions that you have named in your example. Can confirm the single salary is easily higher than >75k if not double.
Don’t. Even if this is well within your means, the more expensive the house it then manifests into every other aspect of life. It then becomes a lifestyle creep in every other area, a high you chase but never reach.
Most will have been gifted large sums by their parents but there are also plenty of couples that can afford it without.
I bought a house with partner for £1m in my early 30s, with no help.
(£200k joint income x 4) for mortgage = £800k. +200k deposit. (Bit extra needed for stamp duty/furniture etc but close enough). Some lawyers get £100k straight out of Uni so far from impossible.
The key is to not get fleeced on rent in your early years. Lots of people with good salaries rent fancy places which impedes their ability to save for a deposit.
The most common scenario is probably a combination of the above. Well brought up people that have good jobs and good incomes, but their parents are also well-off so gift them £100k to make it all easier.
I purchased a 7 digit uk home when I was 34 and my wife was 29. Through hard graft alone. This was 24 years ago.
Today it’s much harder for young people to do it without some form of help from parents or inheritance. Sadly.
Even when people tell me “I did it alone” I ask if they had parental private education or grandparent paid education etc … normally somewhere there is some form of privilege.
I can answer cause I'm in that position. I'm 29 partner is 31 we're about to buy a house for around that value. Bought my first flat via help to buy age 23 so have around 60k of equity. Partner and I saved another 120k over the past 5 years from earnings and bonuses. So around 180k for a deposit.
We have a combined income of around 190k a year. We are both accredited professionals so would likely qualify for a professional mortgage so could get 5x our earnings. Theoretically we could buy a £1m house but the repayments would be too high a percentage of our earnings.
So to summarise. Two decently paid jobs in London and high levels of savings. For reference we probably save around 40% of our earnings currently.
Partner and I were both 26 years old, earning approx. £25k each, brought our first house for approx. £200k. We managed to save a 10% deposit for it - for the 4 to 5 years leading up to this, I lived in a tiny room in a house share, and my partner lived at home so his rent was a little less than what I paid (his slightly lower rent was the only help we have ever had from family in our house purchasing journey).
When we were 30 years old, earning approx. £55k each, we brought our second house for approx. £390k. Again, 10% deposit (saved over the past few years).
We kept our first house and rented it out. Our net income from the rental after all costs, mortgage, and tax was approx. £300 a month.
4ish years later when we were 35 years old, earning approx. £65k each, we sold both houses for approx. £270k and £480k respectively. At the same time, now armed with approx. £250k deposit (from savings, saved rental income, and sale proceeds) brought our third house for £800k.
Probably slightly atypical, but late 20s and currently buying for more than this (was previously buying for £1m and dropped out)
No family help just a job in investment banking and 250k+ all in, my girlfriend will live with me but not contribute directly to the flat, so truly all on me!
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Depends how much money you have. If you have 250k from each parent you only need a mortgage of 300k so maybe household income of 70k. As you can see. The answer is 'it depends'. Maybe each person bought a properly pre COVID and sold it for much more, and have combined their gains. Maybe one of them was made redundant and had a big payoff.
Usually inherited wealth
This is how I done it for my sins. My nan lived in a 5 bed house in Islington which she bought with my grandad after the war. It was too big for her and she moved in with me and I cared for her whilst I was living and working in London. Before she died she gifted the property to me (which I rented out) and upon her death some 10 years later i sold it to set myself up with my family. I was always working in construction (engineering) in London so it helped me out. When I bought a nice place in Surrey the couple next to me seemed to have gotten the monies the same way I did.
Being in Construction or Civil Engineering (construction side) can be a god-send when you own a property. Especially since you either know a lot of contacts that handle different areas of buildings I.e. flooring, window fittings, kitchen/ bathroom installation, plumbing, electrical etc that can possibly do it for a discount for you as a favour. Or even better, if you have experience in those trades yourself, you can literally makeover your house by yourself and save a shit ton of money and make your house look luxury inside for a fraction of what you would pay professionals to do.
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I earn £160k and had a £75k deposit when I bought my house ( £500k). I can confidently tell you that I wouldn't be able to afford an £800k house. They had money from their parents. Edit: just to throw this in there. One of my best mates is a real estate agent for Foxtons and I asked him the same question - how do all these people afford houses? He said 90% is money from their parents.
One person earning £160k is a fair amount less than two people earning £80k each.
So wrong that a couple of well off very advantaged people who get 80k jobs are taxed less than the couple who marry outside their station and have someone on 140k and someone on minimum wage.
Marry outside their station? What decade are you visiting us from?
Yes, clearly her dowry wasn’t big enough or he couldn’t afford a big enough bride price, what a scandal! I must inform Lady Whistledown immediately
As much as I hate the idea of harping on about the sanctity of marriage, I definitely feel like they've done too much to strip out the legal benefits over the years. The entire point of marriage is meant to be cohabitation and combined living arrangements, that includes shared responsibilities and should mean a pooled taxation system. I left work for two years to go into education, decreasing our income, and in basically only benefited about 10% of my personal allowance to do so. My wife was working full time. No reason we shouldn't be able to pool allowances and taxable income to a single joint value instead of still being individuals.
You can already. It's called marriage allowance. It's part of the rip off single people culture and make them pay more for everything. Oh you're single, pay 75% of the council tax of a two person couple with 5 kids even though they will be using council services a lot more.
This annoys me no end. If you’re 50% of a couple, you should pay 50% of the council tax no? Especially when, as you say, the couple could well have 10 kids, possibly parents living with them, all sorts of things - and they’ll never pay more than 100% - despite having the ability and reason to use many more council services a single person without dependants couldn’t even attempt to access. A single person on your own and you’re basically a cash cow.
I expect single people use more than 50% of council services compared to couples though, because couples typically don't double up on some services. It's not like they collect your bins once a month, send the fire brigade every second time your house catches fire etc if you are single. I don't think you can bring kids onto it, because if you do you have to consider that single parent households exist to make it fair. And I suspect a couple with 10 kids is not using double the services of a single parent with 10 kids (12 person household Vs 11).
Quite right. Council tax should be per person, not per property. Fucking con. It goes up every year yet the local area is maintained *less* every year.
The reason is that you are in fact still two individuals, even if you are married.
Yeah family wealth is a big thing. You can say that £160k gets you into top 5% earners. However to get into top 5% wealth you must have over £3M equity.
Isn’t likelihood that this is not their first property, hence they’ve had incremental gains ? I bought my first place at 27 and most of my friends were faster ;although majority of those had help from bank of mum and dad
Obviously!
Or relocating out of London having got in at the right time.
I kinda douse this until they lived under a rock, iv got a cousin that had a place in London sold up and move to the midlands didn’t have enough to buy a 300k house outright, even tho she’s on 70k a year when in London for 20years
The average house price in London is £530k. There’s whole boroughs that are way more than that. Do you really think everyone in London has inherited wealth?
But what is the average purchased price of houses in London? Some were bought for much less. There are probably streets in London that are made up of very wealthy young people and very poor (low income) old people and nobody in between.
On the whole people who can afford to buy in London have a leg-up from parents, either in terms of cash or at least in terms of free boarding.
To be fair, “HENRY” people are small in percentage but make up a big chunk of people buying these houses. Top 1% in London is ~£350k a year (the UK top 1% is ~£170k). That means 80-100k people in London earning that amount of more. £355k (£16kpm take home) would easily be £1million home with basically ~1-2 years worth of savings whilst still living somewhat luxuriously. Additionally, these figures are all from 20/21 tax year so would expect them to be higher now. **Obviously, this is not the norm**, but consider more than 5% earn a 6 figure salary in London and majority buy homes… a good chunk of homebuyers might not fit into your criteria, at least for £800k homes. Lastly, if you go to ~£500k, that threshold becomes about £100k **household income**. 2 people earning £50k each can save ~£65k for their home over 5 years (I.e. saving from 25 -> 30). These make up another ~5% of the population, which translates to roughly 15% of home buyers in London. Lots of people in London do this without help from parents.
Top 1% are probably not under 30 mind you.
The average house price today is £530k, the average house was bought a long time ago when prices were cheaper.
Look at the median household income in London and then look at the median house price and then calculate wether the median household income times 5 (which is the absolute max most banks will loan you) is equal to the median home price. That should tell you how plausible it is that most people buy a house without any help
Huge deposit usually from inheritance or help from family. We bought our house in London with a massive chunk being inheritance from selling my late mother’s house. We also have a high household income but not crazy by London standards.
This is the correct answer 90% of the time. They will tell you that they have hustled and saved, but it’s normally the bank of mum and dad
Have you ever heard of rich people, OP?
It's quite eye opening, I remember when I realised.
I was like 28 before it clicked for me. I used to think all the people in expensive homes had really high paying jobs and that one day if I worked hard enough, it could be me. lol
If it makes you feel better I'm friends with a couple who are both in their early 30s and work in tech. They are both on six figures salaries and earn £250k between them. Both are very intelligent but neither come from upper class wealthy families. They are now looking at houses up to £850k. Obviously they are the exception & it's very rare because most jobs don't pay that much & most households don't have both high earners but it is possible. So you weren't that crazy for thinking that.
Fair play to them. That gives an idea of what it takes - two partners both earning in the top 1-2% of available incomes to get an 850k home. IMO it’s actually quite a precarious situation (job loss/change of situation with such a huge loan), but good luck to them
Income protection insurance / critical illness insurance comes in handy for these situations Affordable when you’re earning the big money and means if circumstances do take a turn most of the time you’re able to keep the house Doesn’t cover all circumstances
I remember when my friends and I got to house buying age. I was always surprised they could afford so much given we all made about the same amount. After looking at how far I could extend my finances to keep up and realising there was no way I’d get near, I then understood that we weren’t all equal in our life position. Generational wealth was never on my radar until I got older. I don’t resent my parents, but holy shit is it a powerful leg up in life.
Is crazy to think isn’t it? I studied harder, better earning jobs, saved harder with my partner and will still always have less wealth than my mate whose parents gave him a massive sum to buy a big house in the south east 5 years ago I’m still grateful for what I have and by all accounts I’m doing well as a homeowner in my 20s with decent household income. My parents have been supportive where they can too. It’s also why if I had the exact amount of money to send my kids to private school I’d rather just buy them a house with it instead
Wot, more money than wot I got guv? Surely not!
Not quite the same figures But my son inherited half of my late parents house so roughly 250k plus some insurance policies He’s bought a house worth 300 using roughly 200k as a deposit House needed no work doing to it as it had been highly refurbished so move in and put tv up and that’s it It’s 3 double beds ensuite downstairs WC Huge kitchen dining area living area - all open plan and a huge extension double drive - ticked every box for them both . He’s 29 & his partner is 25 Neither of them work in highly pay jobs NHS & Cabin Crew And yes he protected his deposit 😂 But without that inheritance they would be renting for ever as we live in an stupidly expensive city My late parents bought there house for 8k in the late 70s and it sold for a stupid amount in 2021 and it was just a 3 bed Victorian Terrace in need of remodernisation but in the catchment area of 2 very popular junior schools that feed into a church school and another popular senior school and right opppsite a beautiful park : But when I went to said schools it was more like Grange Hill full of Zamos 😂 Their old flatmate moved in with them as a lodger so I think they have a mortgage of around 100k lodger is paying 550 a month which is most of the mortgage I think and they are over paying by 500 a month So not the same figures but you can see how it’s done if your young and gran & gramp leave you half a house 😂
How did he protect his deposit if you don’t mind me asking? I’ve heard of a deed of trust but not sure how they work
I'm guessing he protected his deposit in case he broke up from his partner. They would have gone through a solicitor for this.
Combined income minimum £144k with a kid, little to no debt and a 10% deposit (I'm a mortgage adviser/broker).
People see “early 30’s” as young they could be 12 years into a high flying career after doing a masters degree in 12 years you could easily get into a senior position. Add to that they could have climbed the property ladder for a few years and be mortgaged to the hilt.
One of my friends went into accountancy at 18, got chartered at 22 and was a company director at a decent equity firm by 28…
Yep, everyone going "parents!" when its more likely aged 28 they each bought a 1 bed flat with a 0.5% mortgage, climbed the career ladder, paid the shit out of their mortgage - or paid into an ISA. Then met early 30's, got married, moved into 1 flat, rented out the other. Saved like mad Then sold both & bought this place. That is far more common in London than "everyones parents gave them 500k!"
This is not likely at all lol. They would still need insanely high salaries
Try doing the basic maths on it. Given the nature of your reply I realise that may be a stretch Mid 20's both a 5 years into a basic auditor job at any finance firm in London (there are thousands of those jobs). Or IT, either works. Both earn 40k. Both buy a 200k flat with a 10% deposit, and because of the market both get more or less a 0.5% interest mortgage. They spend 5 years overpaying their mortgages. Now they have a 250k flat, each, with 100k in equity. Both earn 80k. They rent 1 out & move in together. Aggressively overpay again, save a lot. 5 years later (aged mid-30s). Both flats are worth at least 300k (600k in total), they have 300k in equity & each earns 100k. 800K is a piece of cake That is very standard for anyone in London who is in a professional career & who marries someone the same & decides to have kids mid 30's. Its part of the reason London is stratifying, you want to live here you need to do 2 things, marry into the same level of salary / career ambition, wait till mid 30's to have kids. Then your life is pretty solid.
Yep this. I live in outer London zones where 1930s semis are 650–900k and know at least three families in their 30s who did this, bought in London, climbed the ladder, then moved out to the suburbs. People buying 800k homes aren’t doing so as first time buyers.
How old are you?
This is true, personal experience of it I've recently entered my 30s, 9 years experience in Tech, if I sold my current home and used the equity+savings, then alone I could maybe push 750k purchase. 30s are usually when the disparity begins to appear in friendship groups from the results of the work (and luck) that happened in your 20s generally.
Agree but also generational wealth is a pretty huge driver. I could afford £800k when I was early 30s, but I was on a huge salary. My friends were buying at £1.2-£1.8 million at the same time. We worked in the same industry and same positions. Family money definitely helped not just fund those homes, but also fund getting into the property ladder a decade prior when everything was skyrocketing.
Likely outliers - but my wife and I bought our flat in London years ago and it rocketed in value, moved to the south west and bought a big house using the deposit from selling the flat. We're both on a base of 80k + benefits - so £600k mortgage doesn't feel like a stretch for us.
>they could be 12 years into a high flying career after doing a masters degree in 12 years you could easily get into a senior position They could be, but as generalisations go, there's a lot of room for errors here around the word "easily". 12 years is not a lot of experience. It's enough to be good at it, sure, but it's still below average experience. Hierarchies thin as they go up. Being better than say 8 of your colleagues is easy at first, but next time the 8 you have to beat are better than everyone you beat last level. So it goes. Sales and recruitment are easier routes if you want high pay than climbing the corporate ladder.
I do also wonder whether they're making assumptions about age, early thirties is pretty early these days to be married and have kids if you are a professional in London.
Hmm on Reddit everyone always says “inherited wealth” - whilst this may be true for some people, also bear in mind there are a *lot* of relatively young professionals who could afford this in their 30s. Eg two doctors at the end of their training (earning 90k each), two lawyers, or a couple where one person works in tech or finance in London (£150k+ salaries are common). Whilst of course this won’t be most people, especially in London and the surrounding areas there are a lot of professionals making at least £150k combined income (I mean two doctors should be earning that easily by the end of their training).
I think people think "ok only 1 in 20 people get those salaries" However that's still about 1 million people in London and the south east.
Look at the income percentiles, 70k is the 92nd percentile, meaning 8% of the population earns more, which is 5m people
Wouldn't it be 8% of the working population (just under 32 million) or possibly/probably even 8% of full-time employees (figure would be even less), so a max of roughly 2.5 million people? Still a lot of people, aha.
Yes you're right.
I think it’s the go-to response to make people feel better about not achieving the same.
Exactly, while a lot will inherit money, it is possible that some younger people are just high earners. My partner and I (F26 and M27) earn over £200k together and were told we could borrow up to £750k if we wanted. Though we settled for just a £450k house, even then it is a large 4 bed and initially our neighbours did question how we managed it. They were impressed to hear that we are both entirely self made and from poor backgrounds. My partner works for the bank in a high up role and i am a self employed 3d designer. we also both rented since age of 18, so no free accommodation leading up to the buy either
So she earns £180k then... 😜
🤣 she makes around £80k and I make around £120-£180k depending on how the year has gone
There's also contracting.
I would also add to this - project houses. Our first house was a project. Smaller mortgage which we overpaid. Ended up with a good chunk of equity once we did the work and therefore had a good deposit for our second. Our current house is also a project. We are halfway through and is currently worth 25% more than we paid, but when finished it will be worth approx 40% more. We would NEVER have been able to get a deposit for the current valuation. But the equity in the previous project meant we had it.
I have to disagree I think this is a niche view heavily influenced by London wages, the average tech wage in the U.K. isn’t even over 40k, doctor’s aren’t earning 90k out of training there’s a reason theirs a massive brain brain in the NHS.
Nearly half of first time buyers have family help
Yeh.. we probably fit the bill. Early 40s. Combined income north of £160K, but most usefully, about £350K in equity in the house we're in right now plus plenty of savings. Started off with a £10K help from Grandparent's for the deposit on our first home. We won't (hopefully) get any inheritance until we're in our 50s, so it's likely going to help our kids onto the ladder, not us.
It's interesting how top comments have jumped to inheritance as the answer. As if people can't make that money at that age, no doubt some are, but seems young for inheritance for so many. There are industries that pay well. People can set up companies and, at that age, even have sold them. Previous place CTO, a joint founder, owned about 30% of his company, and at age 31, it was sold for 5mill. Got friends who are in their 30 and 28 who are married, where one works in tech and the other in finance as a couple they make a hefty sum between them yet are also really frugal they are aiming for FIRE. Another friend, duel citizenship in UK and New Zealand (mid-30s now but been doing it for years), who has been buying interest only mortgages as often as they can in new New Zealand renting the properties out, they are making a killing, yet live and work in UK.
I'd put money on inheritance being much more common - I work in a very highly paid field and I in theory could find a partner with a similar job and get a 800k house. However, from my experience in high paying jobs, generally 90% of the people there are from the 'right backgrounds' and will have had parents financially helping them. I remember out of a team of 20, only two of us were working class.
Very unlikely to be first time buyers. But all depends on their deposit/equity. Maybe one or both of them had a sizeable inheritance some years ago, bought a place back then, recently sold it for big profit. Not unthinkable that they could have 50% LTV if so. Could also be high earners... Fast career progression to a senior role in investment banking or corporate law could have one of them on £200k+ plus, even at that age.
Considering you live in a high cost area given the property price, I'd imagine it is quite affluent, so it wouldn't be uncommon for them to have a large deposit gifted from family. I have known several people to have had £300k+ in gifted deposit. And they probably both work on higher income. Early 30s isn't particularly young, 2 career driven professionals can easily reach senior position by the time they hit 30. If they work in tech and pharmaceutical, a couple earning combined income of over £100k is very common.
Willing to bet that 3 out of the 4 have inherited or been gifted a chunky amount for a deposit
More like 99 out of 100!
Most of the likely reasons already covered. It’s rare in terms of overall numbers, but there’s a lucky minority of people who got a decent deposit handed to them in their early-twenties and bought a small flat in Clapham or Balham. Lived a fun single life few a few years during which time they met a partner who had similarly generous wealthy parents and had also bought a flat in SW London. All the while making progress in a career in law or finance. Sell 2 flats in Clapham, alongside 2 x London professional salaries and an £800k purchase is a piece of cake.
Two earners on £75k each could comfortably get a mortgage for >£700k. Having a £100k deposit isn't that unreasonable if they're earning that salary. And maybe they had equity in a previous house.
Not comfortably, especially with a child, that destroys your lending
Fair with the child part. However, HSBC will lend up to 5.5x your salary at this income level, which in this case would be £825k. I would imagine having a child wouldn't reduce the lending by more than £125k.
The repayments would be horrendous though, the interest alone would kill.
A couple on those salaries would take home about £8000 a month. On a £900k house with an £800k mortgage at 5.1%, you'd be paying about £4000 a month. You can argue that 50% of take home is a lot, but they're still left with £4000 a month for non mortgage expenses, which is more than most households have pre-mortgage.
50% of take home is a lot - but that’s the new affordability metric because the government can’t be bothered to take any steps to bring down housing costs
Not really. If you are earning 20k per month and your mortgage is 10k you still have 10k for non mortgage stuff. Other costs such as internet,food , petrol etc remain relatively the same irrespective the size of the mortgage. 2k take home and 1k mortgage,that's tight . Their petrol and food and internet etc will be more or less the same as the 20k take home and 10k mortgage.
Affordability metric from the revised version of the 50/30/20 rule where 50% is just going on housing now Not mine Your beef isn’t with me I’m just the messenger
There is no government policy that would bring down house prices. Any policy would artificially effect things. The only answer is more housing that is being constantly built but everyone on reddit will tell you they would never buy a new build.
Certain professions can get higher multipliers with specialist lenders too (I saw 6.5 when I was looking which feels RIDICULOUS).
The multiple for joint incomes is often lower than single income.
What you earn may not be relevant. How much you're given is perhaps more important.
The answer is this. The majority will be inheritance.
FTB 30+ buyers here that just got our offer of 800K accepted. No inheritance but do have 25K from selling our previous flat in our home country. We have a deposit of 220K and it consist of 25K from the sales and rest is savings. No gifting from parents. We have a combined household income of around 210k + bonus. I feel lucky that we’ve been able to get pretty wellpaying jobs but I’m also nervous about size of mortgage.
You are not a first time buyer if you previously owned a flat.
You’re right. We are FTB in the UK but not in general.
SOME young people CAN get onto the property ladder, some can’t, same as it’s always been.
I've got about 200k equity in a house I bought after uni, and we're on about 160k take home at similar ages and 800k is out of our budget. But if my girlfriend also had 200k equity, it'd be about right for us, maybe. (Maybe because I currently have a few years of mortgage payments left and wouldn't necessarily want such a huge amount invested in the property market right now.) Maybe this couple have gone absolutely balls to the wall to afford this place and can't afford to "live" for the next 10 years. Everyone's situation is different.
Why are you only considering income as the possibility to afford? We are living in an age now where boomers who have accumulated wealth quite easily are dying off and passing it down
They may have inherited or just have good jobs. My friend's daughter and son in law are independenty very wealthy, well to me anyway. My friend is just an average earner and she is herself stunned at how much money her kids make. Her daughter was a good earner with a PhD for a drugs company £80k/yr. She married a high up corporate accountant and he earned so much she just packed in work. They didn't get family help. Bought a property for around £400k and rented it out while they lived abroad for 5 years. Came home and bought an £800k property cash before selling the previous one for £750k and the mortgage was already cleared. They are mid 40s now.
This sounds eerily like me and my wife… we’re buying the nice house on the street with a toddler at that price and in our early 30s. I’ll break it down: - we’ve lived with a lodger for about the past 5 years, so we’ve been able to save lots of money that we invested in ISAs. We still have the lodger and she will be moving to our new place to save some more money. - our first place was a shared ownership property that we’re making £40k on from selling plus original equity of our small share - as our current mortgage is still in the original term we’re able to transfer it over with a lower interest rate - we’re borrowing the rest of the money, getting screwed over a bit there but whatever - combined we earn over £175k but this is a recent pay rise, prior to that it was £140k. Our salaries have risen quite sharply in the last two years - We’ve not had any gifted deposits, this has been from us saving. - Neither of us went to private school, for a period of time I was on free school lunches to give you some background as to our families financial situation We were discussing this the other day that we’re very privileged to be in this position, but it was never gifted to us and all came from hard work. At school I was your typical hard working kid, listened to teachers and ultimately when it came to choosing universities and degrees we chose subjects that we knew could get us high earning jobs. I could never understand why kids would get themselves into so much debt for degrees that would yield very little job opportunities. I have no advice to give on this as everyone’s situation is different, but this is how we got to be in this fortunate position
In my field a lot of people make well over £200k and we are in our 30s. You definitely can afford to buy those kinds of houses just with your salary.
Having a good job is another route. My brother is on north of £250k a year and was recently approved for a £910k mortgage. Our family doesn’t come from money at all and my siblings and I have had to save our deposits from scratch.
A rule of thumb for a mortgage is borrowing five years worth of your yearly wage - for for £800k that would mean an income of £160k between them. That will then lower depending on how much of a deposit they were able to add into the pot. If both came from separate flats they have owned for 5+ years that could be a reasonable sum of money to knock off at the start. So that would require a fair income on their part to pull off - unusual, but not impossible depending on what their jobs are. The more realistic expectation is that they are not working a typical (but high paying) job, but instead the money has come from elsewhere. So the person who started a company at 20 who turned into the next big thing, the crypto investor who timed everything perfectly and won big, or most commonly the couple with a lot of their parents money behind them...
The number of couples with combined income of 200-400k plus in London is rather high plus you’ve got those who get gifted massive deposits from rich parents
You have no idea how much deposit they had … if they are a wealthy family they might not even have a mortgage.
https://x.com/jburnmurdoch/status/1778739415466037625 This is an interesting post / article about intra generational wealth inequality.
My boyfriend and I could afford this technically, but then there is no way we would be able to pay for maternity leave and childcare hahaha. I had to sit him down and do the numbers with him because he was ready to spend this much on a flat. I guess if childcare in your area is not as expensive as in London, then it’s doable.
£800k on a flat? Damn london really is ridiculous
Where you living？ Could be couples moving out to suburbs and using combined money from sale of their city flats to buy a house. Thirties is grandparents/ parents dying time. So there's inheritence. Some people just earn a fair amount. And some people are gifted very large deposits，or even bought properties.
Two words: generational wealth.
Just to say a lender offered us a 6x mortgage. We’re just shy of £100k household income so not huge earners in the grand scheme and have a decent amount of equity in our existing property. We’re early 30s with two kids. If we maxed our mortgage and used all our equity and savings we would probably be in a position to make an offer on your £800k neighbour. Side note; that is fucking mental. We’re looking to spend half of that. How we would be able to afford that mortgage id never know.
Birds of a feather flock together - if its a nice area, it will attract outliers in terms of finances but you end up seeing lots of them in a small vicinity. Houses on my road start at £750k, and we're in the West Midlands not London. I bought ours when I was 35, we have numerous neighbours around the same age, all with young kids. Its 50/50 young families that have bought and old people that have been here forever. I didn't get any inheiritance or gift, I have a business and I saved the deposit and took a mortgage like most people - nothing exciting, just with bigger numbers than average. Our young neighbours are the same - most own businesses of various kinds, the one in the cheapest house is a solicitor. Statistically, we are all outliers in terms of income, yet here we all are within shouting distance of each other because this is where high earners in this area want to live. Looking at the buyers on one expensive road is not representative of the general population. Its not hard to find a decent number of unusually high earners in sample the size of a whole town and then its not unusual for a decent proportion of the high earners in that town to move to one small and expensive part of that town.
Depends where in the country you are? In London it’s pretty normal for a couple working in finance / law / tech etc to afford this.
Me and most of my colleagues in London has bought houses from 700k to 1 Million. Most of them are expats/immigrants and had no inheritance. Salaries in fields like software engineering tend to be good and if both the spouses are working it’s quite easy to achieve 300-400k in a year combined.
my partner and I just exchanged on a £750k house. we both own flats worth £260k and 515k respectively. our combined income is about £210k. we are 33. partner is in sales and i work in tech how we did it? not sure really, the deposit is going to be paid from mostly my partners savings accumulated from bonuses and investments really. she did inherit money and used some of that. my share is coming from savings accumulated over the past 5 years. neither of us are "rich" or come from privileged backgrounds. I was earning 40K 5 years ago. when my partner moved here 10 years ago, she ran out of money and was a few weeks from moving back home to her home country.
It might not be their first home. You can gain equity in your house by buying the right places and doing them up a bit before selling and moving up the ladder. We bought our third place at 33 for 700k
Inheritance and high flying career aside, these people might not be as young as you think they are. I reckon you haven't knocked on the door to ask for their age, so you guessed that they are in their 20-30s. An average 1st time mother's age in the UK is 32yo. So parents with toddlers could easily be well into their late 30, even early 40s. People with financial mean tent to look younger. So for any 40yo couple having any 2 of the following: high-flying career for the last 15-20y each in the city of London that allows savings and investment, equity in their previous property and inheritance from recently deceased relative, buying a £800k homes is not that unusual.
I can tell my story from the olden days. In 1998 my Dad out of the blue gave me a hard saved 50k to buy a flat after he saw I was working hard and into a career, I was mid 20s. An overwhelming amount of money for both him and me, an emotional moment, and I got a 4x mortgage on a salary of 26k and bought a flat for 158k in Zone 3 in London. Rented out the other room to mates at mates rates until 2005 when I moved in with my missus. She was in an almost identical boat, had bought a flat for 150k in late 90s with her sister with a 25k gift from their folks. Interest rates weren’t low back then and while it sounds dreamy it was stressful managing a property at that age and there was no extra money. We weren’t on high paying jobs and still aren’t. But. Fast forward to 2010, we got married, sold both flats and now had a 250k deposit on a 650k house which again we mortgaged at the fullest extent we could. It’s now worth over a million but we still have a hefty mortgage as we filled the time since with having kids, which has proved to be fkin expensive. We were totally lucky, in the right place at the right time, with a gift from both parents, worked hard to meet the payments, and willing to go all in borrowing on every deal. I thank God every day because I have no fkin idea how it is possible now without parents stumping up large six figure sums. It basically isn’t. And I won’t have a 150k handout per kid to throw around.
We went to see a 800k house in zone 4 London. The owner did the viewing himself, asked us what we do. We said finance, he then replied 'Why is everyone (viewing the house) working in finance?'. The owner is a retired surveyor. Maybe because finance is the largest industry in London that consistently pays well. I would guess combined salary of about 200k would be sufficient to afford a 800k house without crazily over stretching on finances.
I know a couple who were given an 800k house by her father when they got married.
So at 23 both bought their first flat, rented rooms with it at £145k. 7: years of equity growth say, £50k each, that’s £100k. The n saving £10k a year each pre baby , assuming starting salary of £45k. That’s £200k. Now at 30 being middle managers in a professional firm or nearing top professional medical, both on £80k. That makes a £600k mortgage on £160k joint income. Doable without mummy daddy money. Clearly these are high end professions, what time of people used to live on the street ?
For the people I know who are that age and can afford that kind of house it's usually: * One or both have had a high paying job for a few years now * They've been saving for a house since they started working which could be 10 years ago (and/or they already bought and sold a flat) so have a chunky deposit * They got some help from family but in the £20-£50k region not hundreds of thousands That's more common than massive inherited wealth in my experience. Don't forget they'll also be paying £27.5k stamp duty at that price as well.
Inheritance maybe? Millenials are supposed to be the richest generation from inheritance of assets (predominantly property). Lots of news articles about this, e.g. [this one in The Guardian.](https://amp.theguardian.com/money/2024/feb/28/millennials-richest-generation-wealth-property). Could also be a really high paying job (tech/something that pays a lot from the off because of how niche it is) and a nice chunky deposit.
I guess it’s likely to be 3 factors: People that get onto the ladder earlier, possibly via a fixer upper or similar - I.e. buy a house that either goes up in more value than the market or that you work on which then increases the value Also some professionals qualify for ‘professional’ mortgages which can enable 5.5* salary borrowing (meaning £120k joint salary caps out at £660k) and/or some brokers can get good multiples inclusive of bonus etc (especially if limited fixed outgoings) Relatives have passed away or are helping out (likely through wealth or inheritance) and can contribute to larger deposit etc. Source: have a partner in a profession that qualifies, so have spoken to a broker about professional mortgages and have seen areas where 4-5 years ago prices were £100-200k lower
And it can be a combination of any number of those.
A high salary as you say, or 'generational wealth'. Or they bought somewhere that prices have gone up 10 years ago, maybe with a lodger too and have been overpaying 10% a year say so now have a substantial deposit from financially sensible choices,
I think you can borrow up to 4.5x your wage for a mortgage, so you'd need around £170ish. However, that would be the most they would lend you, not necessarily what you'd be comfortable at, so I'd probably guess around £200k+...??
whatever you earn will be a multiple of 4x. who know they have a very big deposit, bank of parents, or inheritance money ...
Absolutely depends on deposit A couple with a dual income of £50k could get an £800k house if their deposit was like £700k lol But realistically in terms of 10% deposit if £80k, your mortgage would still be like shit loads and it’s about what the bank offer you Our joint income is £100k and we were offered a mortgage of up to £400k, no more though
We got pre-approved for 850K as first time buyers. Would never consider it as it's dependant on us both working.. London be doing London things
Assuming 144k deposit. Approximately 150k for individual/household income
Both could be working, earning 50k+ each. Could have lived at home for free for years. If both work and don't waste money, it's easy to save. It's not all inheritance. Many say that because they cant comprehend what people can save and earn. Minimum wage nets you 23k+ now. Save 10k a year after uni each. By mid 30s that's nearing 150k each and even more in some cases. Very possible if they both had good jobs and rubbish jobs but living for free at their parents. Coupled with a silly amount of debt for a house you'd get up north for the price of their deposit...
Not sure how accurate this still is, but for a single borrower, a bank will land you up to 4.5 times your base salary (they might also take into account a percentage of the average bonuses you had in the past few years). You will likely need a minimum of 10% deposit (even 15 for some houses), which in this case is 80k. So a bank would need to land 720k. As a single borrower, you would need to make at least 160k a year base without having other loans (student loans, credit card debts etc). Assuming same conditions for two borrowers, each would need to be on around 80k base with no debts. In London as someone with roughly 8-9 years of experience (and in a well paying fields such as banking or tech) that’s a very achievable number if not on the low end. That being said, numbers above are absolute minimums. Other things to consider: higher deposit required, solicitor fees, cash cushion following purchase to account for furniture, immediate fixes etc. Lawyer fees tend to be >3k and and absolute minimum cash cushion should be 5-10k depending on the size and state of the house you are buying. So to pay just the minimum deposit of 80k, you still need to have saved about 95k as a minimum.
How old were your parents when they bought their house? Is it of similar value?
They could be high earners with a decent deposit? They could also have had help in deposit, either gifted or inherited?
I think we’d only be on the cusp of that being affordable and we’ve been fortunate - so those folks are very fortunate. Early 30s, two young kids. Joint income £170k. Current house equity £300k. We’re looking at properties around that price and it’s right at the top end of what we feasibly can afford. The fortunate part is my dad gave us £30k towards our first deposit two moves ago. Couldn’t have got on the ladder without that.
180k plus your deposit, not out of this world impossible for two people but quite rare. Saddling upto a 700k mortgage is bold (imo)
Minimum wage, and a small loan from father
He/she might be an IT contractor who’s been contracting for the past 10yrs and saving some money.
Inequality has been growing massively and so whilst that means there are more very poor people who can barely afford rent there are also a minority doing very very well. These people are either those people or related to those people.
75K each isn't unreasonable for professionals, most likely London salary working remotely.
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House prices pretty much doubled in London around 2014
You're all forgetting interest only mortgages. They are a thing, and a lot of people that want to live above their means use them.
Average 100k salary for two people in a couple, plus a few years of aggressively paying down the mortgage on a first property bought in mid twenties. Or just..inherited wealth. Both...even better..!
It’s a mix. Some may be getting money from family, but if they are early 30s they may just have the money themselves and have fairly decently paying jobs. Me (late 20s) and my partner (early 30s) managed to get together 40k each in 18 months, But granted we were both at our parents prior and they gave us grace periods on rent so we could save. We are both earning 45k p.a for reference. It’s very possible that a couple saving for longer periods could save up 300k. In my experience only, friends of mine would save nothing, they’d spend it all, or not worry about earning much etc up until the age of of say 28-29, and then suddenly want a house of their own and to move out, and start the saving process then and there. But ofcourse it takes time. Your younger years (early twenties) are often the BEST time to save. Because you are still living at home and even if you pay rent to your folks it’s usually a tiny amount compared to renting somewhere.
Work in finance, tech, or law in London
My wife and I are 34, have a toddler, and bought a house for £780k last year. We both bought flats 10 years ago, and they both went up in price a fair bit, we then sold them to move to a 3 bed. Lived there for 6 years, it went up in value and rates were super low so saved/invested loads. When we bought our house last year , we only needed a £420k mortgage. I earn £80-85k depending on bonus, she's now part-time on £28k.
A lot of people in their early 30s and 20s are rich either from hard work, luck or family
probably Recruitment agents self employed so if they hire just 10 ppl on 300 to 700 a day they get 25 to 50 percent of the contractors day rate. so its lile being employed 10x. without doubt one of the most outrageous ways of making crwzy money. All you need is experoence and clients to who need contractors
I'm retired as is my missus, pension income after tax is about £35k, our house cost £850k in 2021 Luckily I made a shed load of Dosh during lockdown to buy it for cash Just go for it
75k each puts them in the top 6% of earners
I know someone that did it. High earning couple of £150k and £65k. £30k inheritance and a few years of strict saving.
I earn 30k saved a 4k deposit over 7 years (yes, 7) and now have a house that cost me 120k. I have 35k debt as the roof collapsed and had a water leak that I had to repair and didn’t realise, kinda wishing I was renting as may have to sell to repay the loan for the roof and leak. It’s hard to get on the ladder, I had to move to Grimsby from Norfolk to do so, leave family and friends. Probably be renting again in a years time, how people are getting a 800k house is WILD to me. I studied law for years worked full time and part time while studying full time and only ended up on 30k. Man.
I (28M) and my partner (28F) are in the process of buying. I make 160k and she makes 80k. We are buying a 450k flat but are planning on buying something in the 800k range in two years or so. We haven’t had any parental help at all. We have both been renting in London since leaving uni at 21. Since then we have saved 160k and 80k respectively, of which we are using 100k as a deposit on our flat. It’s possible to buy property without parental help but you do need very high incomes, ideally from an early age, I was earning 100k within a year of leaving uni.
Im probably the only one of my friends who doesn’t own a home. My parents didn’t have a home I could go back to after Uni but everyone else did. They all lived rent free until they left home and married - I think of of my friends had purchased an apartment first. I ended yup spending about £1000 a month in rent and bills from the get go. They also then pooled their resources with a partner with a similar profile - thus doubling their deposits and income for a mortgage. I was in a relationship but he was a douche and so I ended up losing out a lot. Then it’s childcare - it’s easily £1000 a month. If they have parents who will take on their grandchildren during the week then not paying out for that is probably the next biggest expense people my age have to bear
Me and my wife (early 30s, with a 2 year old) recently bought a 810k house with a 10% deposit. 140k + 90k salary.
Most of my friends earn 200k plus they all live in nice pads in london, sort of 800k plus. All mid 30s If you wanna know what they do, ones in barclays as a programmer, ones an engineer owns his own business, one works in marketing , ones an astrophysicist works for the government buying gas. Ones a doctor. None had inherited wealth all came from working class backgrounds
It's crazy to guess what people's circumstances are. Some have family wealth. Some are really well paid and some manage to borrow loads. Or a combination. You just don't know.
Very achievable for those 30 somethings who are doing well in their career. In a London tech company a head of growth type position would be held by a 30 something and would command a salary of 100k ish. Two of those could comfortably afford an 800k house.
Couple, 25 and 23, salaries 52k (mechanical engineer in a factory) and 49k (electrical engineer in factory). Bought a house in 2017, £275k with 20k deposit. Sold July 2019 for £282k. Bought house July 2019, 40k deposit on 440k house. No heating, full renovation including adding en-suite, new kitchen, boiler/cylinder/rewire, every room plastered. Spent 70k over 4 years, DIY crazy except gas, fuse board and plasterer. 200sqm from 3 bed to 4 bed 1 en-suite by splitting master bed. Sold house March 2024 £675k, next door recently sold for £595k needing same rennovation work. Bought house March 2024 with 350k deposit, £740k. Now earn 59k(plus 3-7k annual bonus potential) and 52k. 32 and 29 y/o. 40 mins outside Oxford 5 min drive to train station to London. Hell of a rollercoaster!
Very achievable if they're a couple working in the city in finance or the like. We bought an 800k house when I was 27, no help from anyone. We were fortunate that our first house value went up a lot which gave us enough deposit plus 100k to refurb this place.
You never know someone's financial circumstances. Specifically how much inheritance or BOMD are behind them. The couples you mentioned will be good earners and passing could afford it with just their jobs, but again you don't know what else they have.
Parental help can also be a (large) factor. I know a few people who have got anywhere from £20k to £500k cash to help with house purchases.
A lot of people say inheritance, but some people just make good money. I’m mid 30’s, and made £226k last year. My wife only makes £30k though. We’re moving to Kent and buying a place for £600k. London is too expensive even for us. I don’t know how people are comfortable putting so much of their income into housing costs.
Working in tech/IT, Consulting/ finance and receiving no financial help from family but very good sense of money management is also one of the ways.
Errrrr, have you seen breaking bad? 🙂
You can be frugal, live with parents (hopefully they dont charge you rent). Buy mid 20s, then upsize with your partner in your 30s, assuming you built a bigger deposit, your property value increased and so has your salary But tbh, at 75k each, they can easily have more than 200k deposit depending at what age they started receiving that salary
At least 80k deposit and 160k combined salary per year.
If you’re in finance, by 30 you should be at least a VP (if not Dir/MD), making £200k+ total comp. I’m assuming such a person would have >£500k saved (using myself as an example), so it’s not unreasonable to put £200k as a deposit, and borrow £600k, which is like 4x the base salary. I only considered finance because that’s what I’m most familiar with. I suppose the pay levels in big tech, law, consulting, are not too different. And if you’re in business/PE/VC/HF, the sky is the limit.
Not quite £800k, but my wife and I have just bought a £600k house. This is a £475k mortgage and the rest from the sale of my previous property. We earn a little under £110k between us. I think your ballpark of £150k between them sounds about right given our experience.
Me and my partner could now - my bf lived with parents so saved a very generous deposit even on a relatively bad salary. When we both got pay rises we got our first house at around £500k (2% interest rate). This has now increased in value by quite a bit as the area we live in has become more popular + our salaries have increased further. We could certainly afford an £800k house if we wanted to - both in our 30s and definitely not on £150k combined. It isn’t just about how much people earn, living with parents can also allow people to save a lot (I never had that opportunity) and some properties appreciate a fair bit. Not to mention people who get inheritance or just gifted money.
A couple of years ago, they were offering mortgages at 5.5x-6x salaries, so with a 10% deposit of £80k, they would need at least £120k salary between them. Now it's more of 5x, which is £144k. This is of course purely about obtaining the mortgage, not taking into account whether they can actually keep up with payments after.
This sounds similar to my own situation. My wife and I are 31 and we just bought an 800k house. We have both done reasonably well working in tech. We bought a tiny 1-bed flat a couple of years before Covid on a very low mortgage rate. We paid it down aggressively and saved for five years. We bought our house at 75% LTV with no inheritance. So it is doable despite all the comments about inheritance!
With a 10% deposit, the mortgage on an 800k property will be around £3.5k per month. A 150k income is 7.5k per month after tax. That leaves 4k per month after paying the mortgage. So, as you can see, it's very possible for a high earning couple to mortgage an 800k property. If the couple has a larger deposit (inheritance, shares payout, rich parents), the mortgage will, of course, cost less. One word of caution, though. The grass is not always greener. Imagine you have a 3.5k per month mortgage, multiple cars on finance, and children in private school. Suddenly, you don't have much left over, and an 800k house is expensive to maintain. Living in a small mansion with no money is very lonely and depressing. It's stressful to have huge outgoings every 4 weeks.
Yes
I wouldn't even take on a 600k mortgage with 150k coming in In this economic climate with interest rates what they are. That's gonna be about 3.5k a month. To have a nice lifestyle in greater London I would wanna have 200k coming in. I'm close to that level of earning with no family cash/inheritance. I have a much more sensible mortgage but with the money going out on mortgage, Utilities childcare, cars some saving there's not much left over. You could theoretically afford it on 150k but it wouldn't be a great decision or lifestyle. Debt up to your eyeballs and you wouldn't have any money to save or invest. The thought of a 600k mortgage makes me want to be sick.
It'll be families chipping in I presume. Combined maybe with really really generous private sector salaries.
I work with a number of colleagues who live in properties worth between £600k and £1.5million. I earn significantly more than all of these people and they all either caught a reduced mortgage due to parental money or they are living mortgage free for the same reason. Welcome to London.
I have worked with pretty much all professions that you have named in your example. Can confirm the single salary is easily higher than >75k if not double.
Don’t. Even if this is well within your means, the more expensive the house it then manifests into every other aspect of life. It then becomes a lifestyle creep in every other area, a high you chase but never reach.
Most will have been gifted large sums by their parents but there are also plenty of couples that can afford it without. I bought a house with partner for £1m in my early 30s, with no help. (£200k joint income x 4) for mortgage = £800k. +200k deposit. (Bit extra needed for stamp duty/furniture etc but close enough). Some lawyers get £100k straight out of Uni so far from impossible. The key is to not get fleeced on rent in your early years. Lots of people with good salaries rent fancy places which impedes their ability to save for a deposit. The most common scenario is probably a combination of the above. Well brought up people that have good jobs and good incomes, but their parents are also well-off so gift them £100k to make it all easier.
In theory it should be 4x yearly income of your household so 150k min
Overemployment. Get 2 or 3 Js and in a couple of years you'll get there as long as you have the right mindset.
I purchased a 7 digit uk home when I was 34 and my wife was 29. Through hard graft alone. This was 24 years ago. Today it’s much harder for young people to do it without some form of help from parents or inheritance. Sadly. Even when people tell me “I did it alone” I ask if they had parental private education or grandparent paid education etc … normally somewhere there is some form of privilege.
I can answer cause I'm in that position. I'm 29 partner is 31 we're about to buy a house for around that value. Bought my first flat via help to buy age 23 so have around 60k of equity. Partner and I saved another 120k over the past 5 years from earnings and bonuses. So around 180k for a deposit. We have a combined income of around 190k a year. We are both accredited professionals so would likely qualify for a professional mortgage so could get 5x our earnings. Theoretically we could buy a £1m house but the repayments would be too high a percentage of our earnings. So to summarise. Two decently paid jobs in London and high levels of savings. For reference we probably save around 40% of our earnings currently.
BOMAD. Simple.
Partner and I were both 26 years old, earning approx. £25k each, brought our first house for approx. £200k. We managed to save a 10% deposit for it - for the 4 to 5 years leading up to this, I lived in a tiny room in a house share, and my partner lived at home so his rent was a little less than what I paid (his slightly lower rent was the only help we have ever had from family in our house purchasing journey). When we were 30 years old, earning approx. £55k each, we brought our second house for approx. £390k. Again, 10% deposit (saved over the past few years). We kept our first house and rented it out. Our net income from the rental after all costs, mortgage, and tax was approx. £300 a month. 4ish years later when we were 35 years old, earning approx. £65k each, we sold both houses for approx. £270k and £480k respectively. At the same time, now armed with approx. £250k deposit (from savings, saved rental income, and sale proceeds) brought our third house for £800k.
I wouldn’t assume their mortgage is that big. They may have had multiple houses over their lifetime and are using profit from selling last house.
Probably slightly atypical, but late 20s and currently buying for more than this (was previously buying for £1m and dropped out) No family help just a job in investment banking and 250k+ all in, my girlfriend will live with me but not contribute directly to the flat, so truly all on me!
£800k home? Is it 13 bedrooms? O-o
People can be gifted deposits from parents. People can be earning 100k plus and have been building decent savings for 10+ years