The Problems with London’s Luxury Property Boom
Along the Thames in central London is what can only be described as a building site. The many luxury properties being built in the capital are said to bring money into the city, which trickles down to the general public, not just to the super rich.
In fact, this luxury property boom could have damaging effects on the rest of the country. A Global Witness investigation discovered that around one in ten properties in the City of Westminster (9.3%) and 7.3% of properties in Kensington and Chelsea are owned by investors registered in offshore firms.
The Problems with London’s Luxury Property Boom
It is easier to invest stolen money in property than try to hide lumps of cash. The London property market is increasingly attractive to tax dodgers, secret overseas investors and criminal gangs.
As the housing crisis has continued, and continued, politicians have insisted that housing shortages, soaring house prices, eradication of social housing and the messy private rental sector are normal. Politicians have taken no blame for the state of the housing market, but expect the public to manage.
This is no surprise, as they are not the ones struggling. Families are being moved out of London and over half of the people hit by the benefit cap will find the whole of the South of England unaffordable to them.
However, the coalition government pushed through a change to planning rules that mean many developers do not have to build or pay for social housing when constructing large residential developments.
Luxury property developments will not solve the housing crisis. Public housing is where investment is needed.
Some argue that rent controls and regulation of private landlords will avoid more housing stock being sold off to the buy-to-let sector.
While politicians suggest that the problems will end, the situation for those struggling to keep a roof over their heads seems to be increasingly challenging.
Housing as a concept has moved from shelter to asset. When Labour proposed a mansion tax, critics focused on those that have supposedly earned their capital gains, rather than entered the market at a convenient time, leaving many now without a viable option.
The current problem of a lack of supply and growing demand is deep-rooted in a housing system that has simply not been building enough homes.
Housing is now considered a profitable pursuit and central London showcases exactly that. It is no longer a liveable space for many people.
Luxury developments are not solving the problems that those in unstable situations, or even homelessness, are facing.