It has become hard to read the popular press without finding a newspaper article or accompanying opinion piece on the massive changes being wrought on London’s property market. There are two stories at play here. The first focuses on the many thousands of households living in housing stress – finding it hard to keep-up with their rents or mortgage payments – and those who are struggling even to get a home of their own – manifest as massive waiting lists for social housing, bidding wars for rental properties and house prices that exclude many. There are now more than 380,000 households, not people, just on waiting lists for social housing in London. This story has long been a feature of life in London, given the cost and scarcity of housing in the capital; but it is also related to a second story that is the focus here. At the same time as these households are waiting to be housed it is quite possible to purchase a single 6 bedroom house costing more than £100m. So, this is emblematic of the second story that we can tell about the kind of changes being wrought upon London over the past ten to fifteen years or so: the massive growth in those earning and generating gigantic personal wealth and their disproportionate take of housing resources in the city. How are we to make sense of these changes and their impacts?
Numerous observations may follow from an analysis of London’s property markets and the way they act as a crucible for the formation and solidification of patterns of social and economic inequality. First, we might want to suggest, as many property, newspaper and political pundits do, that this is essentially a story of success of which we should be proud. Here we have a world class urban economy positioned at the epicentre of the global processing and accumulation of wealth which highlights the essential role and the dynamism of our economy and its primary city. In this narrative, notions of economic growth, prestigious city status and national pride are clearly identifiable. More importantly, where this discourse wins-out we can see it shaping important policy decisions wherein any intervention in how the City operates or how property is bought and sold is seen as anathema to good fortunes and the basic nature of a market economy that is paying major dividends more broadly.
The second narrative is one of decline and stress in the city, and is one that is increasingly evident in discussions about what to do to improve the city for its residents. As property prices rise, welfare supports are withdrawn from those doing increasingly badly during the economic downturn (many of whom are in work but remain poor). But the most important point to make here is that these two narratives are contested and in many ways not seen to connect when it is clear that the broader changes in the city are linked to these outcomes.
To what extent can we think of the rich as a problem? TV series like Fox TV’s Meet the Russians and Made in Chelsea have popularised life inside the bubble of extreme wealth and privilege, yet the reality is that many of us operate with impressions of the super-rich built around anecdote or (sometimes very good) journalism and this has recognisable impacts on the tenor of debate around what we should do. For sociologists something called society, a holistic entity that includes all of ‘us’, in fact tends to be only a partial and somewhat skewed analysis of its institutions and groups who form in fact only a small sub-section of the population. State-funded and intellectually driven work has always tended to focus on the poor, the dangerous and the exotic. The cost to society is that ordinary citizens are not being offered systematic, evidence-based assessments of the full range of social experience, nor are they being offered insights that build on very real concerns that profound wealth and inequality are indeed social problems that require evidence in order to challenge inequities and drive the kind of public interventions built on popular and informed public viewpoints. This is a very simple point but one that drives the ambitions of the project that we are currently leading.
So to go back to the narratives we can observe around London’s dramatic changes in recent years we can add that there is a need to get to grips with the full range of costs and impacts. We can see that an expansion in the wealth of those at the top of the social pile not only continues within one of the worst national recessions for nearly a hundred years but has also accelerated and been transferred into the massive property investments of national and international investors and buyers. Much of this activity is driven by the sense that London is a safe bet, that its property taxes are some of the lowest among competing cities, but also that it contains some of the most important cultural events seen globally. This combination of safety and culture appears to be driving upward and unending waves of investment and the realisation of massive dividends for those who are already wealthy. London is now home to the most multi-millionaires (the UHNWis we mentioned earlier) with 4,224 living within its boundaries (in raw numbers this is the most of any city globally) and around 70 billionaires.
But it also appears to be changing the social character of the neighbourhoods it touches (talk of ghost neighbourhoods and tax dodges) and is now being linked to broader concerns about the cost of housing more generally as property prices ripple outward and down through the hierarchy of desirable areas across the city. To put this a little poetically perhaps we can see that those struggling to buy or rent in some of the cheapest parts of the city are being affected in part by the ramping-up of prices in areas like Belgravia or Mayfair. These changes come on the top of a history of massive increases in prices in the capital fuelled by increasing real incomes for many of the best-paid service workers and, of course, the offer of mortgage lenders to give increasing offers of credit to those wanting to buy their own home. Combined with historically low rates of homebuilding the scene appears to be set for a scenario in which global accumulations of wealth, massive investment with little need for real-time social use of the city, concerns with the planning and building of housing and political attacks on welfare and support for social housing to create a perfect storm – a city full of housing stress and personal troubles on the one hand, and another glittering city of opportunity for those who have profited from the global capitalist system yet who appear to create largely empty neighbourhoods of homes that nevertheless rise dramatically in value.
These various observations highlight the need for on-going work on how the rich live, their attitudes towards and aspirations for the places they come to inhabit and the deeper links between their choices and practices, on the one hand, and the complex outcomes they produce in cities like London, on the other. There is always a danger that social research that focuses on the middle-classes and the rich can be dismissed as the self-interests of a similarly rarefied academic elite, yet there is a long history of sociologists making pleas to their colleagues to engage, despite the difficulty of doing so, with elites and wealthy groups who often not only co-ordinate responses to social problems but are also part of the problem themselves. The expansion of inequality amid social distress and economic decline is only the most recent and notable feature of such problems; there is an on-going need for social researchers to measure, profile and understand the ways in which wealth, power and social life combine.