1 in 10 Londoners are Millionaires- so why aren’t you?

I read with some shock and a bit of sadness this week that London has more dollar millionaires than New York shock because you think of New York as a glamorous city fully of penthouse living, Wall St work, Manhattan drinking millionaires and I’ve been to London and whilst a lot of it is nice place it doesn’t feel uber-wealthy but Frank Knight know better. and sadness as I’m not a Londoner.

London now has more millionaires at 1 in 10 than any other city in the world. So if one in ten Londoners or nearly 875,000 people are a dollar millionaires, how did they do it? Through hard work, prudence and foregoing luxuries? Well, the answer would appear to be “by owning a home that makes more money than you do” as you can see in the graph below from this report Housing in London 2020. From around 2014 to 2018, median household net property wealth leapt by around £150,000 and things only got better (or worse) since then. So, most of the dollar millionaire wealth is actually just brick wealth – take away housing and you’ve not got much to show for yourself.

Joining the 1% Club?

Sadly, just having a million dollars these days just isn’t enough to join the 1% club of the richest people in the country. For that you’d need $1.8m / £1.3m. My own method is to join the 2% club and hobnob my way upwards – once the kids are in private school and our ponies are at the right stables, we’ll be finally accepted.

Owners win, renters lose

The permanent state of unsustainable house price inflation ends up hurting the roughly 50% of households in London who rent. Renters should just save some money and use it for a deposit. After all the 2.5 million Londoners classed as “living in poverty” can surely must just quit their avocado habit and try to catch up quick! The curse of avocado induced poverty is even worse for the young with 39% of children living in poverty. If only they worked as hard as their houses did they’d have the £151,000 median deposit in no time.

That’s London; for much of the rest of the UK property prices have not gone up as much, in some ways it’s been a lost decade and a half for some areas including our own here with real prices not being changed much since the GFC.

GFF Moving to London?

I never really had the opportunity to work in London – certainly not an offer but I did consider it for a while and could have if I’d wanted to. What put me off was the massive increase in the cost of living and this report opens my eyes about London. For example there is no borough where the average rent is less than £1,000 a month (average £1,425) or the price to earnings for property is less than 10 (average 12.1).

If we moved to London our income could be a bit higher but it would be a trade-off where we’d swap Cost of Living for Quality of Life. Ultimately, I didn’t think that London was compelling enough – although I do like to visit and hope to again soon once this virus business of over.

So we are wehre we are but at least there’s benefits of living LCOL as Money Mage has put written.

Visiting vs. Living In London

London is in many ways like other cities like Paris, Edinburgh, Barcelona, it gets a lot of tourists but there’s a difference between visiting and living there. I wrote this post about a walk from the City of London to Paddington taken a few years back. I had the benefit of visiting as a working tourist and could stay in nice hotels in nice areas and could avoid rush hour traffic. When we visited as a family we did the touristy things and the hustle and bustle was a novel experience and not a nauseating nuisance as it is for so many people. Of course, I’ve not been to much of the rest of London. For one reason or another I’ve probably mostly stayed around the blue areas when visiting, I was no Orwell just a travelling salesman.

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Long Term London Trends

A bit of research shows that London as a city has risen, fallen and risen again over the last 100 years. The graph of population in London shows that the nadir of London coincided with the 1980-2000 and was preceded by decades of population decline, especially for Inner London. For a perspective on those times watch a Mike Leigh movie like High Hopes.

The Grass is Always Greener

Population growth in a fixed area like London leads to a lot of problems. It leads to pressures to build up/out/down. Areas of London have been redeveloped and some places like the docklands are like a city of skyscrapers. However housing pressures remain and it’s not just prices that get worse. There’s an easy way to tell if an area is populated by owner occupiers or rented out by buy to let landlords and that is the state of the gardens. Some of the most expensive areas of London where flats rented for £1,000 per week (always requiring a double take when you look in an estate agent’s window) had the appearance of a favela on the outside. But it’s what’s on the inside that counts and remarkably, owner occupiers have about 60% more floor space in London than renters with the average space of a privately rented flat shrinking per person.

More recently over the last 25 years London has become a massive growth engine. While much of the UK is treading water, London has grown massively; most notably for jobs. Those jobs tend to be well paid, the stories I hear about IT contractors in London make me regret my past choices and if you work in an in-demand industry then you can be doing very well in London.

It’s no wonder that London has sucked in young people from across the world with domestic migration to London being consistently in the tens of thousands for many years. But you can see that whilst the young move in, the oldies move out. For any number of reasons like cost of living, wanting a house with a garden, retirement, trade-down or even trade up in an escape to the country. These trends manifest themselves in many ways but it’s clear that young people move to London, older people move out and if you bought somewhere to live then keeping hold of it was a good choice. What doesn’t make sense is to move to London in your 30s, with kids and rent. In that way, the window of London living is closed for us as a family.

GFF is Guilty of Hypocrisy

I am maybe coming off as someone who is bashing the rich and bemoaning the state of affairs. Yet, my own story involved me buying a flat with 25m2 per adult back in 2006, selling it in my 30s for twice what I paid for it and then moving elsewhere where we have around 40m2 per person when friends of ours are not as well off. We also don’t really have any money worries that aren’t self-imposed. Also, while I would like to have had a massive help from massive house price gains as seen in London, we’ve not really needed it and overall, we’ve benefitted from the ravages of house price inflation as much as we’ve suffered.

Golden Bricks and Mortar

The curse of property wealth is that whilst the house might be rich, you are not. Having a million pounds in equity won’t pay the mortgage and if you do sell your house, you’ve got to go live somewhere else. If you want to love up the property ladder, house price inflation just makes your next house even more expensive. What the future looks like post-COVID we don’t know. Who will pay for the COVID debt? The speculation is that people will be avoiding city life and for many jobs working from home will be the new norm. Who knows, I’m a short distance away from either a sleeper train to London that would get me into King’s Cross by 8am, fully rested or similarly I can walk to catch a flight to London City Airport and make a day-trip of it. Getting that dream job or holiday in London might not be so far-fetched and I can do it from my on Low Cost of Living base.

Thanks, GFF


  1. Love visting London, I don’t think I would ever tire of being a tourist or visitor. Never fancied living there though, even when my sis lived down there decades ago – just all seemed unaffordable even back then. Hoping for at least one trip later in the year when things are a bit more normal.


  2. I don’t much like the place – or maybe it’s the people I don’t like: so anxious and rude. But we did once have a successful short break there, early one autumn. We stayed in an apartment hotel, located such that Harrod’s was our corner shop. We used taxis and ferryboats whenever we fancied. We dined outside, under a gas heater, on the river just downstream of Tower Bridge.

    Probably it best suits members of the helicoptering class.


      1. Neither; it was just a routine ferry. We first used it to go from The Tate to the New Tate (or whatever it’s called). Obvs the route should have been called Tate-à-Tate, but some dolt had decreed otherwise. There were stops along the way. It was an agreeable way to get about.

        If you’ve not been to the New Tate I recommend it. We went to the coffee shop and admired the views across to St Paul’s. You can cross the river on the shoogly brig (as Londoners don’t call it).

        Artistically, of course, the contents of the New Tate are utter dross compared to St Paul’s. Maybe someone intended the joke.


      2. I’ve been in the new Tate first back in 2004 but not in the old Tate.
        The boat ride up the Thames was.great when we went 2 years ago except the kids didn’t care that much for it, I was transfixed as we sped from Greenwich to Westminster.


  3. I’ve been here since 2006 (with 3 years away) and for the most part love the city. Of course I’ve had my ups and downs, days when I’m so fed up and want to leave, and days where I know i’m in the greatest city on the planet. Lockdown has been tough in this city, but i know there is no where I’d rather be (at least in the UK) for when things open again. It’s going to be great!

    Housing is the main issue that people live. As soon as kids come along, people realised that space becomes important.

    Liked by 1 person

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