What Happens When We All Get Priced Out Of London?

In the last three months, house prices in the city have risen by 26 per cent. Is London facing a mass exodus? Artwork by Alex Coll

London

by Alice Carder |

Get off the tube at Old Street tube station in London and you'll be offered the opportunity of a new life, one where, after paying your rent, you have cash leftover to spend on fun things like holidays and clothes and one day might even be able to own your own home. Where is this utopian land of promise? Birmingham.

Following in the successful footsteps of ASOS and Deutsche Bank more companies are leaving London and taking skilled workers with them. And I have to be honest, as I rode the escalator (reading the adverts plastered up both sides) with the other 20-something's, many of us heading to our fourth interview that week, our unpaid internship, or our second job that funds our first job we actually want to do just so we can pay the rent this month; Birmingham looked pretty tempting. Or Manchester, or Sheffield, or Newcastle or Bristol…

There’s a risk if house prices and rents keep rising, then nobody doing an ordinary job will be able to live in central boroughs of London

In the last three months house prices in London have risen by 26 per cent. That’s the fastest rate since 1987; before I was born. Put simply, London is becoming too expensive for ordinary people to live there.

‘There’s a risk if house prices and rents keep rising, then nobody doing an ordinary job will be able to live in central boroughs of London and those on lower incomes will be moved out of London altogether; because they simply won’t be able to afford to live there,’ Shelter spokesperson Pete Jefferys explains.

Growing up in Cumbria, Jenny Shaw a 30-year-old writer dreamed of living in London since the age of eight. ‘I lived in a flat above a kebab shop in Peckham,’ Jenny explains ‘It sounds horrible but it was fine, honestly. It didn’t smell that bad, except maybe in the hallway. The industrial extractor fan outside my bedroom window was pretty noisy though, sometimes it sounded like a police helicopter taking off, but I got used to it.’

‘The rent was over half my wage. I just couldn’t make ends meet. Things got so bad I took a second job in a pub. I was doing over 90 hours a week and came down with whooping cough. As I lay in bed wheezing like a dying Dickensian character, I thought there must be an easier way to make money. I looked for part-time jobs online and Craigslist London came up. It was all escorts and gang bang party girls. I realised I was just going to have to spend less. I had to leave my bar job because it was affecting my main job and fell two months behind on my rent. I had no family to help me out, had destroyed my overdraft, maxed out my credit cards and was bouncing payday loans and cheques left right and centre.

I really miss London, I love it with all my heart. But it's a money trap and a workhouse.

'Homelessness was suddenly a very real fear. I put an advert on Craigslist saying I needed to earn some extra cash and specified no sex. The offers came in fast and I embarked on the weirdest journey of my life. There was a guy who wanted me to dress up as his sexy secretary, one who wanted to sit on my lap, feet smelling, spanking and snail crushing. I met a pimp called Diamond and tested my morals to the very edge. I was so desperate for money I very nearly stepped into a dark and dangerous world.'

Eventually, Jenny left London and moved to Sheffield where she has just written her first book The List of Craig, telling her story. ‘I really miss London, I love it with all my heart. But it's a money trap and a workhouse. You need to be a multi-millionaire or a workaholic to live there now. There is a Philippino proverb: If you keep buying things you don’t need you’ll end up selling the thing you do. If London becomes any more expensive, we’ll end up selling our souls to live there. And nobody wants that, do they?’

Naomi Ward a 24-year-old environmental consultant also dreamt of living and working in London, in the TV industry, but ended up working as a receptionist and door to door fundraiser.

‘I had to subsidise all the unpaid work experience I was doing to pay my £500-a-month flat share,’ Naomi explains. ‘Then I lost my job at the gym and couldn’t find another quickly enough to pay the rent. I was broke and had no option but to leave London. I was absolutely gutted and embarrassed!’

After living with her mum for a year, Naomi got a job in a call centre and took out a £10,000 loan to enable her to move to Brighton, rent a £300-a-month room and study for her masters degree. ‘I got a full-time job the week after I handed in my dissertation. Now I share a lovely one-bedroom flat with my boyfriend (we pay £750 between us). We’re planning to buy in Manchester in two years time because the cost of living is cheaper there. However I do worry about getting a job as there aren’t as many. My boyfriend’s sister relocated to Manchester and it took her months to find a job, as a lawyer!’

The average first time buyer in London is now 33 and earning £41,000 a year – up from an average age of 30 in 2010

According to Bloomberg property reporter Patrick Gower ‘The average first-time buyer in London is now 33 and earning £41,000 a year – up from an average age of 30 in 2010. That really restricts the kind of person who can live here and whole areas are becoming dominated by a few professions or classes. That means you lose skill sets. The kind of skills that British businesses need are moving further and further out, eventually to other cities.’

Owen Leo Roe, a 35-year-old council support officer, decided to move to London from Sheffield when his girlfriend Fran headed to the capital. But the pair returned to the North after just eight months, as London living was so expensive. 'It was so much cheaper to rent in Sheffield that we were actually able to save money for a deposit at the same time,' Owen explains. 'Our mortgage now is about a third of what we paid for a flat share in London. And we have a house we can do what we like with – that's something we could never have imagined having in London.'

Owen says the quality of life is better too: ‘In London, Fran and I were commuting for a couple of hours each a day. Our home in Sheffield is in a leafy part of town, five minutes from work. We’ve got about 18 hours a week of time back, which makes a massive difference to our lives.’

Is this the future? Tired of working all hours in jobs we hate to rent rooms that will never be home, the idea of leaving starts to sound appealing

Is this the future? Tired of working all hours in jobs we hate to rent rooms that will never be home, the idea of leaving starts to sound appealing. And if we do, what does that mean for London? According to Patrick Gower, it's not looking good. 'It used to just be the more exclusive parts of Mayfair – like One Hyde Park, that were bought up as holiday homes for the super rich. They'd be very quiet and when you walked past at night, none of the lights were on. But now those areas are getting bigger, places that were quite active before are becoming just as quiet and desolate.

'If you want a glimpse of the future, you can look at the area people call the nappy valley, in south London, south west London, which is known for families, and so on. Prices there are outstripping Mayfair by quite some distance, so that’s not going to stay the nappy valley for long. You can really extrapolate that around London. Any place where you see a certain community of people living now, if prices continue rising the way they are, they certainly won’t be there in a decade. Will we see such a thriving artistic community in Dalston in a decade? As prices stand and the way they’re going, almost certainly not.'

Pete Jeffreys agrees. 'London needs to be a city where people from all different backgrounds working in all different types of jobs are able to live and raise a family. That’s a city. That’s the modern city that everyone wants London to be and the housing market is currently stopping that. It’s strangling the ability of London to have people from all different types of backgrounds and all different wages. What we need to have is a city where people can afford to live and afford to raise their family for the long term.'

But if current house prices are anything to go by, that vision of London is a long way off.

Follow Alice on Twitter @alicecarder

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This article originally appeared on The Debrief.

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