Don’t forget your Money Tree
Updated: 12 March 2022 | Published: 23 October 2020
Warning!
In response to Russia’s special operation aimed at ‘demilitarising and de-Nazifying Ukraine’, the UK media has embarked upon and is actively pursuing an intensive propaganda programme which is resulting in widespread anti-Russian sentiment and Russophobia. Aimed at cancelling Russian culture and demonising Russian citizens at every level, incidents of verbal abuse and physical aggression towards Russian nationals have been reported in various western countries, including the UK. This comes against the backdrop of reports suggesting that Facebook is greenlighting hate speech against Russians on its social media platform. You are advised to travel to the UK only for essential reasons and whilst there to exercise caution.
Part 3
Part 1: A warning to the Curious
Part 2: How it was for us …
UNLESS you are a Russian oligarch, and reading this humble blog you most likely are not, moving to the UK is not a decision that should be taken lightly*. As with emigrating anywhere, there is a number of important considerations to chew over, especially with regard to where you would want to live, where you can afford to live, and where you can afford to live and most definitely would not want to live unless you are very adventurous or there is something wrong with your head.
In this article, we will focus purely on where you most likely want to live and the cost of living there.
Russians Moving to London: Costs / Jump to Section
All roads lead to London
Renting property in London
Buying a property in London
London council tax
Utility bills & living expenses
Cost of travel around London
How much do I need to earn to live in London?
All roads lead to London
Most Russians, when moving to the UK, understandably head for London for three reasons: it is where the money is, the action is and it is probably the only place in the UK that you know very much about.
Let us assume then that the majority of you who are heading to the UK optionally will invariably have your sites fixed on London, unless, of course, you are being sent to the UK on a company relocation scheme, in which case the choice may not be yours.
For the sake of argument, this article will suppose the former, that you are moving on your own volition, are in it for the money and that as you know little or nothing about the UK, London is your destination: you know that the Queen lives there, that the buses are red, the cabs black and that there is an awful lot of nightlife in the West End.
What you are probably not aware of is that London, albeit the capital city of the UK, the seat of government and centre of finance, is, in terms of attitudes, political prejudices, behaviour and mindset, the least representative place of the UK as a whole. In fact, London, economically, socio-politically and demographically, is so removed and distant from the rest of the UK that if it took off tomorrow and landed somewhere on Mars, not a lot of people would be surprised and some might not even miss it.
As the celebrated English comedian John Cleese stated, London is no longer an English city. It is claimed that white ethnic Britain’s are now a minority ethnic group in London. The division is reinforced further when you consider the fact that most London boroughs voted to remain in the EU in contradiction of the socio-political bias of the rest of the country, which mostly ran in favour of Brexit.
All things considered, the best way to consider London in its relationship to England and the UK in general is as a state within a state.
It thus follows that your experience of UK life, of living in London, will be an entirely different one than if you were to reside, say, in Scunthorpe. Where? Precisely!
Thus, for the purpose of this article, I have intentionally dealt with London and England as two separate entities. Why? Because they are.
I have also narrowed the geographical scope to include only London and England, as I have never been to Ireland, visited Scotland once on a flying visit and know very little of Wales, except for its shape on the map. So, let’s stick to what we know.
(Photo credit: George Hodan / publicdomainpictures.net; https://www.freeimg.net/photo/1484282/bank-broken-break-pig)
Russians Moving to London: Costs ~ Money
In this post we will consider that all important criterion, ‘Money’, taking into account the cost of renting or buying a flat/house and the cost of living when living in the capital, and how much you will need to earn to live comfortably. I know that there are guides out there, viz ‘How to holiday/live in London on a budget’. Forget them. If you are visiting London and, more importantly, planning to live and work there, you will want to enjoy the experience, and for this you will need money. If you want England on a budget, forget London and try somewhere else, like Wellingborough instead.
By far the greatest drain on your financial resources on moving to London will be the cost of accommodation. Is it expensive? No. It is extortionate. Whether renting or buying, you can expect to rob yourself of at least one-third of your monthly wage just in providing yourself with a roof over your head.
Let’s look at renting first, and some of those jolly statistics.
Russians Moving to London: Costs ~ Renting property in London
The amount you are willing to spend, or can afford to spend on renting, will determine the nature of the accommodation you rent and its location. Obviously, the financial outlay for a bedsit (everything sandwiched into one room), a house share (who’s nicked my milk from the fridge?), a self-contained flat or a whole house to yourself will attract different tariffs, as will where you live, ie renting a self-contained flat in the City will cost significantly more than, say, one in Brixton (you hope!).
Before starting out, remember that in addition to one month’s rent in advance and a whacking great deposit, you are going to need references, usually at least a character reference, ie from someone senior in the company where you work and from your bank.
Invostepedia.com1, states that “Housing costs are normally one of, if not the, largest expense in any budget. This is particularly true in London.”
It goes on to exemplify that a two-bedroom flat in the centre of London will set you back, on average, $2500 per month. The article is obviously addressing the American market, but at the time of writing this translates into approximately £1940, give or take a few pence. The same article goes on to say that outside of the centre, the cost of accommodation falls, and uses the expression to as “low as $1,400 dollars per month” ~ which in my book is still a substantially high £1083 per month ~ remember, we are talking about a two-bedroom flat, not a family residence.
Metro.co.uk2 tells us that the cheapest average rent to be found is in the Upper Edmonton district, and says that in the second quarter of 2020 the average rent was £538 a month. Now, at first sight, this seems to fare well with rented accommodation in other parts of the UK, until you read on and find that for £538 a month you get a room in a shared house (please, turn that music down!!)
The same article cites the St Paul’s area (EC4) as being the most expensive to rent at £1,316 per month, followed by South Kensington/Knightsbridge at £1,110 per month. How’s that for a room in a shared house! What did you say, where is Wellingborough? Don’t ask, or I might just tell you!
So, what will it cost you to rent a two-bedroom flat in the cheapest part of London ~ let’s forget about Knightsbridge!
According to comparemymove.com3 you can rent yourself a two-bedroom flat in Bexley for £1,152 a month.
So what is Bexley like. According to finder.com4 “The borough with the second-highest crime rate increase is Bexley, with an average increase of 7% over the last six years. Despite the increase in the number of crimes, Bexley still has a low number of crimes compared to other boroughs.” [article updated Aug 18, 2020]
Make of that what you will, but, from a purely economic point of view, remember that high-crime rates areas are reflected in the price for home insurance.
Thus, the cost of the area in which you choose or, indeed, can afford to live should not only be measured in £££s. The website ilivehere.co.uk5 has this to say about Bexley: “There were a total of 319 street level crime incidents in Bexley in August 2020. The largest category was Anti-Social Behaviour, followed by Violent Crime.”
So much for renting a flat in London. What about buying a home?
Russians Moving to London: Costs ~ Buying a property in London
The most desirable, and therefore the most expensive, boroughs in London are continually cited as Kensington and Chelsea, Westminster and Camden. Kensington and Chelsea appear to be in the lead as a place where most people cannot afford to live, with the price of an average home now in excess of £1.5 million6.
Conversely, the cheapest borough in London is said to be Woolwich, with the average price of a house around £322, 0007. (Presumably a three-bedroom house?)7.
What’s Woolwich like? I could tell you, as I lived nearby when I first moved to London, but that was quite some time ago ~ perhaps it has improved?
If you are looking to buy a house in London on a mortgage basis, which you would only be able to do after a rigorous assessment of your means to support that mortgage, including your credit rating, how much cash will you have to put down?
The lowest down-payment that you can expect to make is 5% of the mortgage loan, but 15% is considered to be a more reasonable figure. The simplest way of approaching the issue is to bear in mind that the larger the deposit you are able to afford the more certain you can be of obtaining a mortgage and the more favourable the interest rates will be8.
There are various ‘schemes’ to assist you in purchasing a home in London, such as the appropriately named London Help to Buy scheme, Shared Ownership, Rent to Buy, First Dibs for Londoners and the Starter Homes Initiative. But in the end, it all comes down to £££££££. This article by which.co.uk9 should either help you or help to put you off. In here, you will also learn about the option and pitfalls of buying a property not too far from London and commuting into the city each day. The upside is that you will get more property for your money and the mortgage is likely to be significantly less; and the downside? Any advantages that you are likely to accrue from a lower property purchase price, and therefore a lower mortgage, will, given the inflated cost of rail travel, be lost on your monthly travel fare. Drive into London? Only if you are a stress junky, like sitting in traffic and have no qualms about paying for those out-of-this-world parking fees, oh, and don’t forget the congestion charges!
For the time being, however, let us hypothesise that you have found a place to call home, have stumped up the down-payment and acquired a mortgage. The next thing on the money hit list is council tax.
Russians Moving to London: Costs ~ London council tax
Council tax is a tax levied on domestic property, in other words a tax on your home (and any other domestic properties that you may own). It is demanded by and paid to your local council, the administrative body for the area where your property is located. It is said that the revenue collected, which is paid to the council in monthly instalments, usually spread over a 10-month period for each year, is used to finance local services, such as schools, rubbish collection, road maintenance, street lighting and so on. That is all well and good, but rent and mortgage payments aside, or included, council tax takes a not inconsiderable chunk out of your monthly pay packet.
In London, every property is allocated a council tax band according to the property’s capital value. There are 8 bands in all, identified alphabetically from A to H, with ‘A’ being the lowest rated band and ‘H’ the highest.
In Barking and Dagenham, for example, if your property is valued as falling within the ‘A’ band, you can expect to pay £1,077.91 a year, and if it should fall in the ‘H’ band, a whopping great £3,233.74 a year10,11 .
By comparison, in the borough of Kensington and Chelsea, if your property has been evaluated as a Band A property, you will be charged £824.55 a year and for Band H, 2,473.76 per year12.
But, wait a moment, isn’t Kensington & Chelsea supposed to be one of the most expensive boroughs in London in which to buy and rent a property? Yes. You’ve tumbled it ~ council tax just does not make sense. To understand it properly, you need to know all about ‘stealth taxes’13?
The irony is, of course, that if your property falls into Band H in Kensington and Chelsea, your £2,473.76 charge is not likely to worry you too much, as you would not be living there if you did not have the means to do so, whereas the £3,233.74 for a Band H property in Barking and Dagenham would no doubt be seen as an horrendous expense, wherever you live ~ never mind Barking and Dagenham!
Suspect you are being ripped off? Take heart, it’s the name of the boat we all are in.
If you think this ‘extra mortgage’ is bad, don’t ~ it gets worse. Next on the wage-packet mugging list comes your monthly or quarterly utility bills.
Russians Moving to London: Costs ~ Utility bills & living expenses
According to bystored.com, the average monthly cost for gas, electricity and water is about £160, so £1920 a year14. If you need Wi-Fi, then you should factor in an additional £20–£40 per month. In fact, utility bills are quite competitive in London compared to other areas in the UK ~ which is a blessing, because in some areas they are crippling.
And now we come to the nitty-gritty: everyday living expenses.
How much will I spend each month whilst living in London on everyday necessities, such as food and little luxuries, that is on going out for a drink or a meal? How long is a piece of string?
However long that piece of string is, you do not want to throttle yourself with it. Your monthly expenditure all depends, of course, on your habits and expectations. How much you eat, where you eat, how much booze you put away, do you like to go clubbing or are you a sit at home type ~ which you might have to be, if you have not got the ackers!
There are many websites out there that will give you a blow-by-blow account of how much specific things cost, from food prices to entertainment, two of which you will find in the reference section at the end of this article. And although London is one of the most extortionate cities in the world today, like anywhere else, you can budget yourself.
But, to give you a taster, so to speak, let us confront the most important things first. The average price of a pint of beer in a public house in London is around £4.60, but beware! ~ in some swanky eating and drinking places you can get really ripped off and pay as much as £22 a pint!
Russians Moving to London: Costs ~ Cost of travel around London
One of the greatest drains on your everyday resources is the dreaded cost of travel. Driving around London is a mugs game. You simply cannot get anywhere quickly and the difficulty of finding convenient parking is as ridiculous as the cost. Oh, and do not forget that nice Mr Sadiq Khan’s save-the-planet congestion charges!
It is generally agreed that the cheapest way to zip around London is to purchase an Oyster card. This will allow you to keep costs down at the same time as giving you travel access to all parts of London, whether you are travelling on the Underground, using the Docklands Light Railway (DLR), by overground rail, some river boats and on London’s buses.
To give you some idea of what you will have to fork out for an Oyster card covering Zones 1–6 in London that can be used at any time, it will cost you £12.80 per day15.
How much do I need to earn to live in London?
So, in conclusion, the all-important question is, how much do you need to earn before tax to live comfortably in London? If you trawl the internet on the basis of this question you will find the accumulative answer to be about £50,000 a year before tax. Of course, the definition of ‘living comfortably’ is a subjective one, and at the end of the day ~ at the end of everyday ~ it all depends upon what you call living and the lifestyle you aspire to.
Summary about cost of living in London, United Kingdom:
Source of data highlighted below: https://www.numbeo.com/cost-of-living/in/London {acessed: 23/10/2020}
Four-person family monthly costs: 295,573.04руб (2,975.49£) without rent (using our estimator).
A single person monthly costs: 83,347.81руб (839.05£) without rent.
Cost of living index in London is 173.46% higher than in Kaliningrad.
Rent in London is, on average, 899.30% higher than in Kaliningrad.
Cost of living rank 41st out of 573 cities in the world.
London has a cost of living index of 82.60.
*I should not have to say it, but I will. This series of articles is based upon the ever diminishing hope that some day soon our Covid-infected world will assume some sort of acceptable normalcy. Obviously, given the catastrophic Covid situation in London, and the UK in general, at the time of writing, any right-minded person would be better off avoiding it. For the time being, Robinson Crusoe and the lonely guy orbiting the Earth in a space station would seem to have it all! But, as they say, Hope dies last!
Stay tuned for my next post on moving to the UK, as distinct from moving to London.
References [Accessed: 23/10/2020]
1. https://www.investopedia.com/articles/personal-finance/091415/how-much-money-do-you-need-live-london.asp
2. https://metro.co.uk/2020/07/18/are-cheapest-places-rent-london-right-now-13006929/
3. https://www.comparemymove.com/blog/your-move/cheapest-areas-to-rent-in-london
7. https://www.express.co.uk/life-style/property/1252543/property-top-cheapest-boroughs-london-buy-rent
8. https://metro.co.uk/2020/02/10/how-much-money-actually-need-buy-house-uk-12174301/
10. https://www.kfh.co.uk/london/council-tax
11. https://www.kfh.co.uk/east-london/barking-dagenham-london-borough/council-tax
12. https://www.kfh.co.uk/west-london/kensington-and-chelsea-london-borough/council-tax
13. https://www.mindtheflat.co.uk/london-facts/what-is-the-logic-behind-london-council-tax/
14. https://www.bystored.com/blog/cost-of-living-in-london#4
15. London Travelcard Prices and Types (londonpass.com)
Additional references
Comprehensive tabulated data on cost of living in London. No publishing date, but it appears to be current! [accessed: 23/10/2020]
https://www.numbeo.com/cost-of-living/in/London
A comprehensive section-by-section breakdown of the cost of living in London. (published: 20 January 2020) [accessed: 23/10/2020]
https://www.bystored.com/blog/cost-of-living-in-london
Copyright [text] © 2018-2020 Mick Hart. All rights reserved.