London is one of the toughest cities in the world for young graduates, according to a new report.
London is ranked 14 out of 20 countries for affordability by the property agency Knight Frank in its 2016 Global Cities report.
The index ranks 20 global cities and includes variables such as the cost of rented accommodation and utility bills through to the cost of groceries.
James Roberts, Head of Commercial Research at Knight Frank, said that residential areas in the centre appeal to young graduates starting out on their career.
“However, as the areas gain popularity, prices rise and often the young graduates struggle to remain in the area,” Mr Roberts said.
In some cities graduates are turning to their parents or getting in debt just to afford accommodation and the monthly basics in order to continue living centrally, he added.
After expenses, London graduates are left with only 19 per cent of their salary to spend. It’s even worse for graduates in Delhi and Hong Kong, where graduates have a deficit of four and eight per cent, respectively, at the end of the month.
Berlin, at the top of the index, is so cheap to live in that young professionals have 64 per cent of their net salaries left at the end of every month, after typical living expenses.
According to Numbeo, the online cost-of-living database, you can maintain the same standard of living in Berlin (£2,177) for half the price of London (£4,200), assuming that you rent in both cities. The consumer prices in Berlin are 30 per cent less, and the rental costs are almost 70 per cent lower than in the UK’s capital.
London has also recorded a house price rise of 40 per cent rise during the past five years. With the average home priced at £387,336, it is 8.75 times the annual gross local pay, according to a report by Lloyds published this year.
Some graduates might have already noticed the trend. According to the Guardian, in 2013 an estimated 10,000 Brits were living in Berlin – this number increased by 35 per cent within a year, rising to just under 13,500 as of November 2014.
