77% of London Firms Say Housing Costs Are Breaking Their Hiring

Jan de Vries · 2026-09-16

### When Your Team Can't Afford to Live Near the Office Picture this: you've found the perfect candidate for a role at your London office. They're talented, motivated, and ready to start. Then they look at rental prices and realize they'd need to spend most of their paycheck just to live within commuting distance. That's the reality for a lot of companies right now. A new survey found that housing costs are affecting recruitment and retention at 77% of large London firms. That's not a small number. It means three out of four big employers are feeling the pinch when it comes to hiring and keeping good people. ### The Trickle-Down Effect on Young Workers Young workers are hit especially hard. They're the ones struggling to buy homes, and often the ones who end up leaving jobs because they can't make the numbers work. When you're just starting your career, you don't have savings to fall back on. You can't outbid someone with equity. So you either move further out, deal with a brutal commute, or look for opportunities elsewhere. For companies, this creates a cycle. You invest in training someone, they do great work for a year or two, then they leave because they can't afford to stay. You're back to square one, hiring again. That gets expensive fast. > "It's not just about salaries anymore. It's about whether your team can actually afford to live near where they work." ### What This Means for European Startups This isn't just a London problem. It's a warning sign for startup hubs across Europe. Cities like Berlin, Amsterdam, and Paris are seeing similar pressures. As housing costs rise, the talent pool shrinks. Startups that can't offer remote options or relocation support are going to struggle. The EU Inc proposal, which aims to make it easier to incorporate and scale across Europe, could help by opening up a wider talent pool. If you can hire remotely across borders without drowning in paperwork, you're not limited to whoever can afford to live in your city. ### Practical Steps for Employers So what can you actually do about it? Here are a few ideas: - **Offer remote or hybrid options.** If someone can work from a cheaper city, they're more likely to stay. - **Provide relocation assistance.** Help with deposits or moving costs can make a big difference. - **Review your salary bands.** If your pay hasn't kept up with local housing costs, you're going to lose people. - **Partner with co-living or housing providers.** Some companies are negotiating deals for their employees. - **Lobby for policy changes.** Housing is a systemic issue, and businesses have a voice. ### The Bottom Line Housing costs are no longer just a personal problem for employees. They're a business problem. If 77% of large London firms are feeling it, you can bet smaller companies and startups are too. The ones that adapt, whether through remote work, better benefits, or creative housing solutions, will be the ones that come out ahead. The EU Inc proposal might help by making it easier to hire across borders. But ultimately, companies need to think about how they can support their teams in a world where housing is increasingly out of reach. It's not just about filling seats. It's about building a workforce that can actually stick around.