Brexit good news: leave London and pay far less rent
Bankers and others who must relocate in the wake of Brexit may miss London, but not its rents. In cities including Frankfurt, Paris and Dublin, their housing costs could be slashed as much as 60pc.
London is the least-affordable major city in Western Europe, according to the Bloomberg Global City Housing Affordability Index, with average monthly rent and mortgage payments equalling 135pc of monthly net income.
Prices have been elevated by the concentration of high-paying jobs in finance and wealthy foreign-property hunters. In Paris, the cost is 84pc of average net income. In Dublin and Amsterdam, it's about 70pc, and in Frankfurt, Zurich and Brussels, it's between 50pc and 55pc.
The Bloomberg index calculates the affordability of renting a three-bedroom residence or buying a 1,000-square-foot home in city centres and suburbs across 105 global and regional financial centres. Rankings are based on self-reported data, including net salary and mortgage interest rates, compiled by numbeo.com, an online database of city and country statistics.
If prospective purchasers in London allocated half their after-tax income to housing, they'd need minimum take-home pay of $11,764 a month to buy in central London, assuming they put 20pc down and have a 30-year fixed-rate loan. A person buying in Paris could afford a similar flat with take-home pay of $6,050 a month. The minimum in Frankfurt would be $3,520.
Major global financial institutions have already announced they are moving more than 10,000 London-based jobs to other parts of Europe. So far, Frankfurt is the top destination.