This is more to raise the point that a lot of other people have been raising but unfortunately I dont think the Virgin Media infrastructure is up to the task in congested areas. I will be looking to move after my first year of M500. The speeds have been fine, however there is literally no point in having expensive internet if the stability is not going to be there for online gaming. I use the Hub 3 as a modem now with an ASUS AC68U and custom firmware and whilst this improved my WIFI and speeds even more, it just wont help with the congestion downstream. Here is my thinkbroadband BQM, I am in the KT5 area.
Within your custom firmware on your router there is probably an option with the Quality of Service settings to define what protocol it uses to specify the QoS queue. You want to enable QoS with either "fq_codel" or "cake" as the protocol. If you have the choice of both, start with "fq_codel" as it's less resource hungry and won't strain your router as much. Or if the router you're using is pretty beefy in terms of specifications, go straight in with "cake".
You can specify even more with your QoS if you really want to but for basic prioritising of gaming network packets, simply enabling QoS with one of those two protocols will suffice. Once you've set them, save, apply and reboot the router and then see how you get on.
If the firmware you're using does not support QoS or the protocols I'm referring to, (they're more commonly referred to as SQM - Smart Queue Management), then the following two do. I'm currently using DD-WRT.
Also in the KT5 area and suffering from the same issue. Purchased a new Netgear R7800 router which has improved the WiFi aspect of things however latency is still a huge issue. Online gaming is practically impossible due to the lag spikes.
After trying to chase this up since Day 1 of installation I was able to speak to someone on the phone today. They said they would ring me back by end of play today so I'm still waiting on that phone call.
As someone mentioned above to try QOS, just FYI I've tried this and it does not solve the issue.
Thanks for the advice, i had adaptive qos enabled already on my router under the "sfq" setting. I have now changed it to "fq_codel" as you suggested and will see if it is any better. I do still think it is an issue with congestion though, you can see the drop in spikes during the night and immediate pickup at 8/9 in the morning. Updated graph here: