London's housing costs squeeze budgets

According to a new report by the Institute for Fiscal Studies (IFS) and the Economic Statistics Centre of Excellence (ESCoE), Londoners have the highest income per head in the UK, yet their spending is significantly constrained by high housing costs. The report reveals that while Londoners earn approximately 39% more than the national average, their household consumption ranks near the bottom nationally after housing expenses are considered. Gautam Vyas, co-author of the research, said: "Our findings challenge the conventional wisdom that the typical London household enjoys higher living standards than their counterparts across the country". The report highlights that, despite high incomes, many Londoners struggle to translate earnings into consumption due to exorbitant housing prices, which average around £550,000 compared to £300,000 elsewhere in the UK. 

City AM (11/04/2025)