At what cost?
According to statistics, almost 20,000 homes were left unoccupied in England’s capital for more than six months in 2016. The collective cost of all these empty properties was around £9.4 billion – with the majority of uninhibited homes found in the Kensington and Chelsea areas of the city. By anyone’s reckoning, that represents a huge amount of empty space in one of the most highly priced cities in the world.
For many foreign investors, the London housing market has presented an irresistible opportunity to buy a high value property, leave it unoccupied while it appreciates in value (and without the potential hassle of having tenants), and then sell it on at a profit. But while the so-called “buy to leave” owners may be predominantly operating in the capital’s wealthier areas, this approach has ramifications for the whole of the city and its population, not to mention the owners themselves.
For example, it’s not hard to imagine that we could soon be witnessing the return of the squatter – something which hasn’t been seen in any real numbers in the capital since the 70s and 80s. If this does happen, it’s likely that they will not take great care of the properties they occupy While there are legal options for Landlords, the damage to property can be expensive, especially if a dwelling has been abused. With absentee landlords also facing different problems to home owners, it’s important that they plan accordingly, and ensure they’re well prepared for any potential damage.
Investors who leave their homes empty also run the risk of theft from the property, as well as burst pipes and issues with things like a leaking roof. While these things won’t always happen, the risk is there and is something “buy to leave” landlords need to be aware of.
For the remaining population of London, the shortage of homes can push up houses prices on even the most affordable homes – making them out of reach for the majority. This means people then have to start looking further and further outside the Greater London area, while still having to travel in each day to work. Not only does the inevitable travel that this entails eat up a large part of the day for commuters, the increasing number of people also puts a great strain on an already struggling public transport network.
Sadiq Khan is acutely aware that the capital’s housing crisis needs to be resolved and has already come up with some solutions. However it’s hard to know how to directly address the issue of empty properties as he has no jurisdiction over their owners who are perfectly at liberty to leave them empty for as long as they like.
But doing something will be essential, not just for the reasons already mentioned, but also to ensure that London continues to be the vibrant, exciting and innovative city it has always been.