Expats should know London's cost of living routinely ranks as one of the most expensive in the world.
Property Costs in London
In an article about why London is so expensive, the Guardian proclaims there's a chief culprit:
"And then there's the biggest cost of all facing most London businesses. This, as it happens, is also the biggest cost facing most London residents: property. Commercial rents in London are high for the same reason that residential rents are: there's huge demand for tightly constrained supply."
However, the cost of housing in London fell significantly in 2019, as also noted in the Guardian. "Despite a prolonged period of ultra-low interest rates, prices in London have been affected by... the difficulty first-time buyers have in affording prices that are still comfortably the highest in the country and the reluctance to take on big-ticket items of expenditure during a period of Brexit uncertainty."
Currency Fluctuations Impact Expats in London
However, remember to consider the impact that fluctuations in currency will have on your budget. In 2019, the British pound experienced significant weakening against the dollar as the ramifications of Brexit and the state of the U.S. and U.K. economies were debated by the media and investors. This can have a real impact on your purchasing power - for better or worse - so don't ignore these realities and think you're immune to them!
Imagine moving to London and then having the costs of housing rise up again, which could result in you being subjected to a much higher rent. Alternatively, imagine getting a great deal on buying an apartment, having the currency jump and then you're living in a great apartment but can't afford the other expenses of living in one of the most expensive places on earth. Do your research and consider all possibilities!
British expats considering moving home in light of Brexit should carefully consider the impact of expat taxes for U.K. citizens.
Specific Costs of Living in London
You can read about the specific costs of living in London
Also view the difference in cost of living between London vs. New York City, London vs. Berlin and London vs. Montreal.
Tax Implications of Living in London
As for U.S. expats, carefully explore information on the IRS website for U.S. taxpayers living abroad. It's important for U.S. expats living in London to understand how these costs will impact you. Here are the current U.S. and U.K. tax treaty documents on the IRS website.
Expat Banking in London
Your ability to open an international bank account, or an account in a local bank account in London, will be impacted by your individual financial position, the country you are moving to, your citizenship, the policies of each financial institution, and more.
Expat banks often require you to make a large deposit before they'll open an account for you, so you'll need to consider if that makes the most sense for you. Check with your current bank at home before moving to London to see if they have a relationships with a bank in London or even a branch of their own there.
In short, carefully research what you need to know about expat banking while living abroad to avoid unnecessary fees and other possible financial complications.