How Much Do You Need to Earn to Buy a Home in London?
Buying a home in the capital is a dream for many, but how much do you need to earn to buy a home in London today?
With house prices on the rise and the average home becoming less accessible to the average worker, navigating London’s property market can be tough, especially for first time buyers.
At The Mortgage Pod, we help buyers across every London borough understand their options and assess how much income is needed based on real figures and your unique circumstances.
What Is the Average House Price in London?
The average house price in London varies widely depending on the London borough. As of 2025, the average property costs over £530,000, with some expensive boroughs like Kensington and Chelsea or Richmond upon Thames seeing prices far beyond £1 million.
Other boroughs may have similar price tags on the surface, but very different trends in growth, borrowing power, and buyer activity. In fact, only seven boroughs are considered affordable to the average first time buyer without extra support.
Even in affordable boroughs, house prices have risen faster than average earnings, leaving UK residents wondering how to balance take home income with the cost of home insurance, stamp duty, and mortgage repayments.
How Much Do You Need to Earn to Buy a Home in London?
So, how much do you need to earn to buy a home in London? That figure depends on more than just the average salary. You’ll need to factor in:
- The average annual income needed to secure a mortgage
- The cent deposit (usually 10 to 15 percent)
- Whether your income fits the buyer demographics in your chosen area
- If you can manage tough price negotiations in high-demand boroughs
Using the typical mortgage multiple of 4.5 times your annual income, a £450,000 home would require earnings of £90,000 or more, unless supported by a buy scheme or financial assistance.
For most people, this is a pretty grim calculation, especially as the average worker earns far less than what’s needed for the average home in London.
Average Income Needed Across Every London Borough
Across every London borough, London salaries vary significantly. The gap between median salary and average house price continues to grow, particularly in west London boroughs and zones that have seen the biggest price rises.
Here’s a sample breakdown:
| Borough | Average House Price | Median Salary | Income Needed (est.) |
|---|---|---|---|
| Kensington & Chelsea | £1.3 million+ | £45,000 | £210,000+ |
| Westminster | £1 million+ | £46,000 | £190,000 |
| Richmond upon Thames | £790,000 | £48,000 | £150,000 |
| Hackney | £650,000 | £42,000 | £120,000 |
| Bromley | £540,000 | £40,000 | £100,000 |
| Barking & Dagenham | £375,000 | £35,000 | £70,000 |
Even in the lowest cost areas, the average income needed still far exceeds what the average worker earns, leaving many reliant on joint applications, family support, or creative financing options.
Why the Income Gap Matters
With average property increasing faster than wages, most London salaries no longer match what’s needed for home ownership. In many boroughs, the salary required to buy even a semi detached property is double what the average worker brings home.
This leads to:
- Lower borrowing power
- Tough price negotiations
- A growing need for larger deposits and additional documentation
- Increased use of financial assistance or buy schemes
For first time buyers, trying to get a mortgage in areas that regularly see property values spike can feel out of reach, unless your income is supported by a second income or long-term savings.
Other Costs to Consider
In addition to your deposit and mortgage repayments, don’t forget:
- Stamp duty adds thousands to your upfront costs
- Home insurance is required by mortgage lenders
- Legal fees usually cost between £1,600 and £2,000
- Moving and furnishing costs can increase unexpectedly
- Ongoing bills such as energy and council tax vary by borough and home size
Your take home income needs to comfortably cover all these expenses, not just the mortgage. This is a factor often overlooked in the excitement of house hunting.
Tips for First Time Buyers in London
Buying in London isn’t impossible. It just requires planning and expert support. Here’s how we help clients manage tough price negotiations and make smart choices:
1. Start with a Budget Based on Your Income
Calculate your gross pay, expected net pay, and fixed expenses. This shows what mortgage and semi detached or flat you can realistically afford.
2. Use Exclusive Data to Compare Boroughs
Some London boroughs offer similar price tags but greater long-term value. We help you understand buyer demographics, market trends, and the income needed.
3. Explore Support Options
Government buy schemes or First Homes may help reduce the salary required to buy in pricier areas.
4. Work With a Specialist Mortgage Broker
The Mortgage Pod can match you with lenders based on your annual income, deposit, and situation. We understand London’s property market inside and out.
How The Mortgage Pod Helps You Navigate London’s Market
Whether you’re buying in a west London borough, outer area, or central zone, we guide you through the process with:
- A breakdown of the average annual income needed in your target borough
- A clear understanding of your take home income and borrowing capacity
- Lender comparisons suited to your financial profile and buyer demographics
- Help reviewing your deal with your chosen estate agent
- Guidance for both first time buyers and repeat buyers dealing with tough price negotiations
We work with UK residents, foreign nationals, and freelancers to make home ownership in London more accessible, even if you’re not sure where to start.
Ready to See What You Can Afford?
Still wondering how much do you need to earn to buy a home in London or whether you qualify based on your salary?
Speak to The Mortgage Pod today. We’ll walk you through the numbers, explain what average income is needed where you want to live, and help you plan for the right mortgage strategy.
FAQs – Income Needed to Buy a Home in London
How much do I need to earn to buy a house in London?
It depends on the house prices in your borough and your deposit. For a £450,000 home with a 10 percent deposit, you’ll typically need an annual income of at least £90,000 to qualify with most lenders.
Which boroughs have the highest property prices?
Kensington and Chelsea, Westminster, and Richmond upon Thames top the list for highest property prices, often exceeding £1 million for the same type of property.
Do most London salaries cover the average home cost?
No. Most London salaries fall short. The average income is too low to match the average house price without a joint application or external support.
What are the most affordable boroughs for first time buyers?
Areas like Barking and Dagenham, Bexley, and Croydon are among the more affordable boroughs, but still require a solid annual income and deposit to enter the market.
Why does the average income needed keep rising?
Because of weak growth in wages alongside rising property values. This is why knowing your take home income and borrowing options is essential before applying.
Can I still get a mortgage if I have a lower salary?
Yes, especially with support like a buy scheme, joint application, or help from family. A mortgage broker can help you calculate your salary required and explore lenders that support different buyer demographics.
