Sunday, September 15, 2013

Unaffordable London

Yesterday I went door knocking/street surgery in my West Ham ward with local Party members.

It was a pretty successful and I think many residents were pleased that we were coming to speak to them and ask them their views.

I had some ear bashing about litter, dog mess and waste bins left in the street. But on the whole, it was pretty positive and solid Labour.

When we had finished we came across a local estate agent who was showing a couple a property for sale. We asked how much this property was. It was a 3 bedroom end terrace in need of improvement but it was for sale for £265,000!  If was modernised it would be worth £310,000.

What a huge amount of money. Who can afford this? When I got home I had a look at the various property websites.

If you could put down a 10% deposit you would still have to pay £1,391 mortgage repayment (interest and capital) each month to repay £265,000. This is also at historically low (and long term unsustainable) interest rates.

If you are on the medium London wage of £653 per week (£33,956 per year and obviously many Londoners are not paid this much) according to the Halifax you could only get a mortgage of £142,428. No where even near £265,000.

If you had a partner and were both on the London Living Wage (£8.55 per hour or £17,780 per year on a 40 hour week of ) both of you could only raise £152,908 for a mortgage.

The average rent for E15 is £343 per week which is £1 more than a London Living wage pay packet (£342 per week for 40 hours).

Newham has been traditionally one of the cheapest boroughs to rent or buy in Greater London.  But if you are on low wages or have no big deposit who on earth can afford to buy or rent anywhere in London?
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