Geoarbitrage: how to survive in London with less than a million quid in the bank!

This week I was in London and met up with the SavingNinja – and we had a nice chat and coffee around the Barbican.  Sometimes it takes you a few days and a bit of thinking to process what you hear from someone else.  What I was thinking about was how can you use a bit of geoarbitrage to work in London but still keep you expenses low – SavingNinja gave me a few lessons

First things first, London is mental for the cost of living and property is particularly bad.  You might have heard about the £5 pint in London, well in 1998 (when I started buying beer by the pint) a pint of lager was around 190p and now around £3.65 in the UK – an almost 100% increase.  Looking at housing  Back in 1998 the average house in London was about £102,000 and is now around £470,000, a 360% increase.  Petrol

If beer prices kept up with houses in London the average pint in the UK would now be £8.65! Petrol was

But when it comes to Houses, House Price Inflation is seen as a good thing even though it’s hard to see who really benefits from something becoming more and more expensive.


Image result for mr money bags

So, back to my visit to London:  I am a regular visitor to London and one of the curiosities is that whilst everyone has a smart phone and is glued to it at all times, there is no shortage of free newspapers to read on the tube.  And what struck me about the newspapers was how horrific the predicament of home buyers is in London.  I read of one couple who now have sold two shared ownership properties to live in one shared ownership property.  They own £500,000 of it and rent the other £500,000.  Just think about that for a minute.  They can only afford half of their house but want to live in a million pound house.  A million pounds!  That’s millionaire stuff right there.  Except they just look like normal houses, maybe normal people are millionaires in London, or maybe debt = wealth.

Another story was about these guys.  With a £5k deposit they have rode the Help to Sell Buy / Shared ownership wave and now “own” a £527k house (although the only “own” 40% of it and of that 40% only 15% is “owned” by them, the rest is a mortgage).  I would be scared of taking on a £179,000 mortgage along with a £316,000 rental agreement for the 60% of the house I don’t own.  They’ve managed to double down on property – thinking that the rise in house prices has help them upsize when all it did was triple their debt and left them more exposed to fickle property prices.

I’ll stick it out up in Scotland where property is more reasonably priced.  Maybe if I was 10 years younger I’d move to London but I’m a bit to old for all that now.

SavingNinja gave me a different perspective (without giving too much away): he commutes into the city where he works.  His commute is longish, but he’s one of the first on to the train and gets a nice seat and works on his blog (you can tell) and a bit of side hustling.  Whilst commuting for many is unproductive and uncomfortable, he manages to make it work.  And since he lives in a less desirable location (sorry – but that’s the stereotype) he’s able to afford a house for just a bit more than the price of a Knightsbridge leased garage.

Image 1 of 4

Yours for just a modest £130,000.


Image result for reusable coffee cupSavingNinja is also able to keep his outgoings to around £1,000 a month which includes the season ticket (around £300 ouch!), mortgage and housing costs (shared).  I’m a bit jealous because we spend far more than that month in month out and it would be nice to think that he’s saving on the big things (no kids, no car) but he’s even saving money his reusable coffee cup!  Damn – some people just seem to have their shit together!

So, another visit to London and I learn more every time.  You won’t get me moving there anytime soon – but it’s a great place to visit and if you are around St. Paul’s and in need of falafel, give SavingNinja a shout!


  1. Haha, you’ve gotta have a reusable cup! I’ve actually got a post written that’s scheduled for Thursday about saving money whilst working in the city. It’s crazy how many people I meet in London who say they’ll never be able to own a house, when I ask them if they have thought about commuting in, they don’t wanna hear it!

    Was great meeting you (even though you didn’t have a reusable cup) 😉

    Liked by 1 person

  2. I would be saying forget the reusable cup, take a flask of coffee with you instead – saves even more money! Working on the blog on the train is such a good idea – we just need to make the most of our situation.

    Liked by 1 person

  3. I do the same as Savings Ninja. I’m pretty sure my house would cost at least 600k if I bought it in /nearer London but it was just 250k for a 35 minute train journey to Victoria. I try to use my commute to good effect but don’t always get a seat and have to change at Clapham so I’m not as productive as I have been on past commutes… Still you can only play the hand you are dealt the best you can. If I’m not on the laptop I’ll read a book, good stuff on the phone or listen to podcasts.

    Let me know if you’re ever round Hammersmith way on one of your visits, or I can do Central after work!

    Liked by 1 person

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