London’s Property Battleground
London has changed, as over the years we have seen the dynamic of this city transform. No longer are areas specific to a “type” or group of people, defined by their career or united in their political beliefs but they are now inhabited by those who can afford it.
If we look at a neighbourhood like Islington in north London, an area once home to the writers, the politicians and to the thinkers. Yet now it is an area more likely to be in reach of a banker or financial investor.
So how has this “walking city”, as Charles Dickens once called it and so many like it, gone from being attainable to completely unaffordable for most?
Is it because of London’s success at becoming an economical and globalised powerhouse, where it’s only competition is seen as New York? London plays a major role in terms of international finance and culture. It’s this kind of appeal that is causing the population of this city to grow at a rate of 100,000 per year. But despite London's economy, inequality is rising.
Loretta Lees, Professor of Human Geography at the University of Leicester estimates that more than 50 London council estates are being redeveloped. Often these areas offer the only affordable accommodation in what are classified as the wealthy areas. This research has found that whilst local governments state that former residents will come back to these new and improved communities, very few do.
Whilst the lower class may be moving further out of the city, foreign investors are moving in. Following the 2008 financial crash, London came back strong so much so the housing stock is worth as much as Brazil’s GDP. Because of this, London gained the reputation with foreign investors as stable place where they could keep and monitor their funds. It was then reported by the media that these investors were pushing housing prices up by purchasing homes and leaving them empty.
But Liam Bailey, Global Head of Residential Research at estate agents Knight Frank believes this foreign demand has actually helped London's housing crisis. He states that it’s "helped developers to reduce development risk during the downturn, meaning that unlike most of the UK, the housing sector continued to build ... and London has more new homes.” Not only this but is helping support research and design in architecture, a major export of the UK.
This property explosion is backed by Mayor Boris Johnson, who believes that without this international investment there would be fewer jobs and affordable homes.
But the underlying issue is that it is a scarcity of housing that is pushing up prices. Reality is that London needs to be building at least 50,000 new homes a year every year to subsidise the growth in population. However this is to be done we don’t know, but it is undeniable that the battle on this shifting landscape of who should go first, will rise between the masses.
To read more visit: http://edition.cnn.com/2015/04/28/europe/london-property-uk-election/