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Has London succeeded at the expense of the rest of the UK?
- biokoda 11y agofirefox reader view actually makes this article readable. First time I've needed it.
- mavdi 11y agoIt's funny how the article considers overpriced housing, zero social mobility and a conversion of once a great city into a luxury den for super rich a success. The very people London needs, nurses, doctors, programmers, firefighters, artists, carers etc are leaving the capital. And not to suburbs, a lot of them to other European cities.
- PythonicAlpha 11y agoMaybe, after a while, they will find out, that they can not eat and will not be healed by their money?
- pjc50 11y agoThe UK has effectively decided to run the country as a property export operation: selling real estate to the global rich. This is setting up a future where we pay a significant fraction of our trade balance in rent to overseas landlords. Is this really politically sustainable? It'll require a lot of funding of newspaper propaganda to keep it that way.
- treve 11y ago> The UK has effectively decided to run the country as a property export operation. That's an insane hyperbole.
- pjc50 11y agoPerhaps, but it's a big part of the problem. http://www.thisismoney.co.uk/money/mortgageshome/article-2340858/85-homes-Central-London-sold-overseas-buyers.html http://www.thisismoney.co.uk/money/mortgageshome/article-234... A slightly counter view with different numbers: http://pdf.euro.savills.co.uk/residential---other/spotlight-world-in-london.pdf http://pdf.euro.savills.co.uk/residential---other/spotlight-... : still points out that large amounts of UK assets are held overseas and that in 2013 there was $10bn of office property inward investment.
- branchless 11y agoHave you seen this yet? http://www.private-eye.co.uk/registry http://www.private-eye.co.uk/registry
- pjc50 11y agoI hadn't, that's an excellent piece of journalism.
- branchless 11y agoGood isn't it. I agree it's great, in distinction to the utter tripe pouring out the BBC these days.
- axanoeychron 11y agoThere is an element of truth in what you call hyperbole. Gordon Brown (in the treasury) produced a report to see how UK could integrate with the EU. The output was basically that the UK economy is not flexible enough. A very large portion of the UK's GDP is based on housing and housing services. The amount of debt on UK housing is astronomical. http://news.bbc.co.uk/2/shared/spl/hi/europe/03/euro/pdf/final_assessment/03_1100.pdf http://news.bbc.co.uk/2/shared/spl/hi/europe/03/euro/pdf/fin... Page 55 onwards "mortgage debt 60% of gdp" http://www.ft.com/fastft/309012/how-would-uk-housing-correction-affect-gdp http://www.ft.com/fastft/309012/how-would-uk-housing-correct... http://www.imf.org/external/np/ms/2001/121101.htm http://www.imf.org/external/np/ms/2001/121101.htm https://en.wikipedia.org/wiki/Five_economic_tests https://en.wikipedia.org/wiki/Five_economic_tests
- pjc50 11y agoTable 1.5 line "Mortgage equity withdrawal" is particularly revealing: in the other countries it's negative, indicating that people are building up home equity, whereas in the UK it's positive, indicating that people are turning house price rises into spending money through financialisation.
- gaius 11y agoBecause we have a single-generation home ownership culture. In Germany and France, most people rent their whole lives and never own. In Switzerland (not EU I know but just for example) you get a 100-year mortgage and pay it off over 3 generations. This is NOTHING to do with an oil sheik buying a £10M mansion - he is not even in the same property market as you are.
- notNow 11y agoWhat makes yield collected from real estate properties any different from yield collected from bank deposits or dividends from shares on the stock market? Also, I don't think that yield from real estate is classified under the "trade" item in the Balance of Payments
- api 11y agoCanada is doing the same with Vancouver.
- buffoon 11y agoI'm not super-rich and I'm doing fine in London. So is everyone I know and that includes nurses, programmers, artists and carers perhaps ironically. None of them are moving away. What is a big problem is hyperbole, media and vocal whiners. Social mobility is bollocks as well. It's perfectly possible to do it and it is easier than it has ever been due to the sheer piles of education available for little to nothing and the thousands of opportunities. Motivation and time are the only constraints. Edit: everyone I know has moved up the social ladder, if there is one. We all appear to be in the same shit at the end of the day.
- DanBC 11y agoCarer is a term defined in law as someone who provides care without being paid for it. Did you mean carer, or did you mean care worker?
- buffoon 11y agoCarer. My neighbor is one for her two disabled children. She sells art and things on ebay to make ends meet.
- pjc50 11y agoCan she really make enough on ebay to pay for London rents? Or is she heavily dependent on benefits that are vulnerable to being cut, such as housing benefit and disability benefit?
- buffoon 11y agoShe has a mortgage that the benefits are paying interest only on and disability benefit as well for her children. She bought the house in 2002 so the mortgage isn't terrible. I think she breaks even every month on a good month. I will add that her husband died from bowel cancer in 2006. If ever you think your life is a bitch, it's a good comparison point.
- 11y ago
- dageshi 11y agoThey'll just be replaced by immigrants from the new entrant EU countries won't they? Problem solved.
- nkoren 11y agoI'm an American entrepreneur who has started two companies in London. My most recent startup was recently accepted into an accelerator in Berlin. Like-for-like, the real estate in Berlin is cheaper by a factor of roughly 6. The overall quality-of-life multiplier is roughly similar. It is definitely making me reconsider my long-term commitment to the UK.
- mavdi 11y agoSame here. My clients are in the US and I work from home. So it's only logical I rent my flat for a ridiculous price and live elsewhere.
- ThomPete 11y agoBerlin has the culture and the cheaper prices and def some interesting companies but it still doesn't have the capital and proper access to the things that make London (and SV and New York) great cities for startups. So I think it really depends on what kind of startup your are trying to build. Europe doesn't have much going for it with London ,Berlin and Stockholm as the exceptions. But just like you can go to LA and pay a third in rent of what they pay in SF doesn't mean that it's advisable. Again depending on what kind of business you are running.
- pjc50 11y agodoesn't have the capital It's weird how capital is localised to particular cities in an era of air travel and Skype.
- ThomPete 11y agoThats how humans operate what can I say.
- marcosdumay 11y agoThere's probably a huge opportunity in that. I just don't know how to exploit it...
- vacri 11y agoWhat do these 8.5 million super-rich londoners do, if doctors can't afford to rub shoulders with them!?
- pidg 11y agoFinance.
- cjrp 11y agoAlso there are doctors, and then there are _doctors_ - e.g. junior doctor working in A&E vs. partner at a Harley Street clinic.
- irremediable 11y agoDoctors aren't tremendously well-paid in the UK. Look at the recent attempted reforms to junior doctor pay.
- ZenoArrow 11y agoDoctors would join the thousands of other people who commute to work in London.
- gutnor 11y agoThere is a lot of social estates in London. There are area like East Dulwich where you are either living in the estate and pay fuck all (while you qualify), or you can afford 1 million+ to buy a place. So that's a weird mix where the rich lives with the poor, but the middle class is excluded. ( well, from time to time, one of the estate flat goes on sale for between 300 and 400K which is somewhat accessible to middle class, but then less than 20% of the housing on an estate are privately owned via right to buy scheme, and most of the time the original owner are still living in as they can't really buy better anywhere else ) edit: note that for nurse, there are help scheme available via key worker shared ownership ( you buy a share and rest the rest ). So you have more chance to find a nurse living in the center than a doctor. Also note that the problem comes from the price explosion of private housing over the last decade. 10 years ago, where I was looking, there were estate, shared ownership (50% of 200K) and private properties starting 200K and up. Now, you have estate, share ownership (25%!! of 600K) and private for 600K and up. The salaries are about the same and the level of help to access government assistance hasn't changed much either. So you can progress from poor to lower middle class, but then there is huge gap to be able to afford your place.
- kraftman 11y agoThat's a whole lot of scrolling just to read an article
- branchless 11y agoIt's the new BBC: looks nice, almost no content.
- twic 11y agoYou read the article? I just looked at the lovely pictures.
- seanhandley 11y agoYes.
- edsykes 11y agoit's not rendering properly on chrome: Version 45.0.2454.101 (64-bit) on OSX
- d_j_s 11y agoYep: https://www.youtube.com/watch?v=S8g3HU3qENs&feature=youtu.be https://www.youtube.com/watch?v=S8g3HU3qENs&feature=youtu.be
- iliaznk 11y agosame here
- parsnipsumthing 11y agoMe three
- deleted 11y ago[deleted]
- burriko 11y agoInteresting, I'm on the exact same version of Chrome on Yosemite and it's rendering fine. I wonder what the difference is? (unless they've just fixed it in the last 20 mins!)
- simonbyrne 11y agoIf you include commuters, London's population is much larger than 12.5%: approximately 14 million people live in the "commuter belt" [1], which would put it at 21% (and a lot more people commute from even further, myself included). Still, London has nothing on Seoul, whose metro area encompasses 49% of South Korea's population. [1] https://en.wikipedia.org/wiki/London_commuter_belt https://en.wikipedia.org/wiki/London_commuter_belt
- billybofh 11y agoBrings back to mind the row about Eddie George's comments : http://news.bbc.co.uk/1/hi/business/197995.stm http://news.bbc.co.uk/1/hi/business/197995.stm
- PythonicAlpha 11y agoA success that is based on basically gambling and helping super-rich people to avoid taxes, is moral bankruptcy. Even without believing in a universal power, one can only hope, that such an endeavor (of the British government since Thatcher) will ultimately collapse.
- branchless 11y agoCan't believe this is down-voted. Clearly by people who are not in London having the life squeezed out of them as they toil for usurers who are in complete control of the money supply.
- PythonicAlpha 11y agoTo those that downvote my post without reading it: You can downvote this post, but not the truth -- because one day it will stand behind your own neck! -- The problem, IMHO is, that many educated people still don't see what is happening in real life. They dream the capitalistic dream of never ending wealth -- but capitalism never was crafted to make all people happy and it was even not crafted to make the diligent people happy, but it was crafted to make a few random people happy by taking from the rest. Capitalism might be the best system crafted by humankind, but it is still a system, that is not sustainable and in today's form it brings us sooner or later back to the dark ages of industrialization. You can see it first in the developing countries, where communities exist, where big corporations come, take the water sources away from the people and sell the water with big profits to the better of people in the big cities. Days will come and have already come, that also in the western countries, many people (will) see, how capitalism is destroying those which created the wealth to give even more to those which own the wealth.
- branchless 11y agoTo be clear: what we have in the UK is not capitalism.
- PythonicAlpha 11y ago
- stevetrewick 11y agotl;dr: We may never know as the article doesn't address the question, choosing instead to list the author's favourite reasons why London is so awesome. I beg to differ, personally. Poor air quality, overcrowding and hopeless mobile infrastructure put it low on my list of desirable places. If your idea of 'culture' is state subsidised opera and looting then maybe London is for you, but there are superior and more diverse cultural offers around the UK. YMMV. Anyhoo, a more cogent statement of the question the article poses might be 'London has recently greatly benefited from globalisation in ways the rest of the U.K. has yet to duplicate, why ?
- parsnipsumthing 11y agoAgree that the article doesn't actually answer the question. I love London but the article is poorly reasoned. Additionally a lot of it is focused on the post-2008 recession period which is ludicrous. London's dominance is a century old, it has nothing to do with "London bankers".
- spacecowboy_lon 11y agoTLDR its "I dont want to go to Salford" The BBC to curry favor and to save money and screw people on pensions moved a load of its shows to salford in Manchester. You do understand thats why Dr Who and other shows are made in wales.
- rjsw 11y agoThere are plenty of nice places to live in Manchester.
- spacecowboy_lon 11y agoWell ill give you Alderly edge as long as you don't mind having footballers as neighbors.
- rjsw 11y agoHave you been reading glossy magazines ?
- branchless 11y agoVery weak. Briefly touched on something of substance here: > Financial regulation in New York was far stricter than in London, where the relatively light-touch oversight regime proved attractive to investors. The UK is playing regulatory arbitrage. They let banks come and do whatever they want because the UK is going down and they are desperate (and corrupt). London is controlling the rest of the UK because the banks are there and it is the banks, not our government, who decide how much money is issued. They are drug pushers and The City is a cancer.
- ig1 11y agoI don't think you understand how finance work, the UK has one of the best financial regulatory regimes in the world, market participants want to be in London not because it's unregulated but because it's well regulated. If you have too much regulation you stiffle innovation and development, but too little means that investors don't trust institutions with their money. So it's a trade-off between the two factors.
- ZenoArrow 11y ago> "I don't think you understand how finance work, the UK has one of the best financial regulatory regimes in the world" If it's that well regulated, why did the subprime mortgage crisis hit us so hard (compared to the countries that escaped relatively unscathed)?
- dagw 11y agoThe regulation was optimized for making the normal case as efficient as possible, not for mitigating the worst case.
- ZenoArrow 11y agoYet other countries avoided the bad deals, how did they manage to do that? There are a number of countries that experienced no recession after the subprime crisis... Australia, Brazil, China, India, Poland, etc... If the UK's financial markets were well run, why did they suffer?
- sinzone 11y agoSame problems in SF. City booming, high cost of living, not enough houses for everyone.
- simonh 11y agoI wonder under what circumstances do those three things don't go together?
- SamReidHughes 11y agoWhen there's spare land.
- ZanyProgrammer 11y agoIn San Francisco it's a ridiculously low density of building.
- Kurtz79 11y agoIt should be even worse in London, where outside of the very center most buildings are single family houses (with garden!), unlike most other European capitals, where the most common living spaces are flats in high rise buildings.
- branchless 11y agoIn a world of land value tax.
- cylinder 11y agoExcept London is surrounded by very nice commuter suburbs with very good, comfortable rail where you can get large houses near a train station. In cities with significant commuter infrastructure, like NY and London you can always find cheap places to live. Plenty of affordable rents in Staten island and NJ. That's why I ignore all the media whining about prices in NY, they just mean buying a place in Manhattan or northern Brooklyn.
- guard-of-terra 11y agoIn Latin American countries, 1/3 of respective country's population live in or near the capital. The countries in question are already pretty sparse by european standards - doesn't prevent population from skipping home even more and coming to capital, both best and worst. Seems like UK implemented the same principle.
- throwaway049 11y ago"32,000 businesses were created in one modish postcode, EC1V" I suspect a big part of this is businesses being registered to accountants' addresses, and people registering as self-employed many of whom work for a single 'customer'.
- Hansi 11y agoYes correct, I actully lived in EC1V, there are not a lot of businesses there. But there a whole lot of businesses all over the UK registered with a 'registered office address' with https://www.yourvirtualofficelondon.co.uk/ https://www.yourvirtualofficelondon.co.uk/ . Including me when I was running my own company (contracting business, rental agreement where I lived forbade using address as registered office address).
- IkmoIkmo 11y agoIn many ways London isn't just a centre for the UK, it's also a centre for Europe. i.e. if we assume a natural tendency for most young people who are able to want to move to a more metropolitan area, then London is pretty much in the list of destinations for all European countries in a way that virtually no other city is to that extent, and it has to do with language. For example I'm in the Netherlands in my early twenties. I know pretty much 3-4 people whose German or French is good enough to consider studying or working in say Paris or Berlin. Compared to that I can easily name 100 of my peers whose English is good enough to study or work in the UK. So if they list their destination choices, it's basically Amsterdam & London miles ahead of anything else, and then come some Dutch cities like Utrecht or Rotterdam or Haarlem. Paris and Berlin are sort of on the list, but with the caveat of either 1) having to take a job that's way below what you could have had in the Netherlands or UK, a job where language isn't important, e.g. waiting tables when you have a Master's in marketing, because landing a marketing job on your level in German or Spanish or Italian or French is just not doable without knowing the language very well. 2) investing a few years into mastering the language, a significant (opportunity) cost. Of course there are exceptions, like international English-speaking companies/jobs in France, but you'll find most jobs in Germany require German, in France requires French, in Spain requires Spanish, same for university education (although English programmes are rapidly on the rise, particularly at the Master's level and in certain fields like business schools), and obviously not everyone in Europe speaks fluent English, but if you look at the ratios, language should play a major factor. Either way, at the end of the day young people in say Spain either choose Madrid or Barcelona or a few other cities like Sevilla/Valencia, or London. In the Netherlands they choose Amsterdam, a few smaller cities, and London. In France they choose Paris, maybe Marseille or Lyon, and London. etc etc. In effect, London is the top destination city for the EU, a union of 500 million people who require no visa or permission or anything like that to move and work anywhere else in the EU including London, and 40% of them speak English as a second language. Every other city is either not the top dog (e.g. Liverpool), or excludes hundreds of other millions of Europeans straight away on the basis of language (e.g. any city in the Netherlands (99% of EU doesn't know Dutch as 2nd language), Germany (86% of EU doesn't speak German as 2nd language), Spain (93%), France (86%), Italy (97%) etc). Then add to that a similar language-driven attraction from the US, Asia, middle east, who must all be rich as they'd need a visa, and you get this ridiculous demand for London fuelling network effects and feedback loops. The demand has led to some pretty perverse mass-gentrification as of late and to a large extent it's from natural (language, in particular) causes I think rather than very specific British policies which obviously also play a role but not a dominating one I think (outside of course the concept of the EU which plays a huge role in not discriminating between any member of the EU and prevents the UK from just having to deal with the problem of balancing London as a centre of the UK and forces it to deal with the problem of balancing London as a centre of the EU, but that's an EU policy not a UK or London policy).
- sjclemmy 11y agoI live in Northern England, and this disparity has long been a source of irritation to me. In the 19th century there was a reasonable balance between north and south, mainly due to the wool and cotton industries in the North. At some point in the last century that parity ended and moving to London to pursue ones interest was the only way to further ones career. This created a virtuous circle as far as London is concerned and a brain drain for the rest of the country. The BBC's Evan Davies touches on some of these points in his TV programme 'Mind the Gap'. If you want to work at a decent tech company and work with like minded folk in an inspiring environment, London is really the only answer. The friends and family I have in London who have a similar education / skills / upbringing to me generally earn more and work for better companies but their quality of life is nowhere near as good as mine with respect to general living. The main trade off is the paucity of like minded friends who live near me. The price of property in this country is absurd and I find it very difficult to see how the situation has not been gamed by the land owning moneyed / political elite over the last 20 years or so. From personal experience there was a 4 fold increase in property prices between 1997 and 2005. There was not a corresponding increase in wages. Who does this benefit? I'll end with a joke: http://www.thedailymash.co.uk/news/society/northerner-terrorised-london-by-saying-hello-20151001102473 http://www.thedailymash.co.uk/news/society/northerner-terror...
- pjc50 11y agoMoved from Cambridge (which is starting to have London house prices) to Edinburgh and it's worked out very well: affordable, less crowded, more friendly, enough of a tech cluster, lots of culture. In re wages, I know at least one person in London whose house earns more in tax-free annual value appreciation than their salary.
- ilurk 11y agoI'm an european citizen who just moved to London and I can attest that is insane trying to find a room in London. A room! I'm not even talking about a house. It's so complicated that there are flatmatting speed dating events. I've been to 5 or 6 now and the ratio is like 15:1. There are even ads on the tube for websites with that purpose. I've spent more than 2 weeks as a full time job! trying to find a place is at walking distance (0-15m) from a tube station. Any! tube station. And there are a lot of them. Finally settled with long term Airbnb room. Which was what I should have done in the first place! 750£ for a room, which is on par with what is being offered in non-Airbnb sites. To put it in perspective the average salary in London is £35k, which gives ~ £2,240 liquid per month. A studio costs you between 1k and 1.5k. Add bills, council tax, transportation (which is quite expensive), and you don't end up with much at the end of the month. If you're emigrating to London and don't have a job and no friend to help you – despite having money – go with Airbnb. If you insist on ignoring that advice, then please avoid agents like the plague! They'll ditch appointments making you waste 2h, ask for 12 months upfront, and leech their 250£ commission from you for basically doing nothing. In the recent years there has been more people moving into London and fewer houses being built. London has a housing problem and the Mayor should fix it. Right now we have a generation of young people in their 20s to early 30s living in houses of 3 to 6 people. This is just nonsensical to me. If you are unable to have your own life in order then how are you supposed to go further and do things like constitute a family. Hence the birth rate decline and the need for a crazy influx of immigrants. In the name of what? Banks and real estate? https://www.london.gov.uk/sites/default/files/Housing%20in%20London%202014%20-%20Final.pdf https://www.london.gov.uk/sites/default/files/Housing%20in%2...
- harryc2011 11y agoI assume that you mean any tube station within Zone 1 because otherwise this is just not true. For 1.5k you can rent a 2 bed flat in Zones 2-3 and get much more than this further away if you're willing to flatshare. I have a friend who shares a 4 bed in Morden and pays something like 650pcm all in.
- acrooks 11y agoThat seems a bit high to me. I pay £650/month all-in for a room in a three-bed just around the corner from Stockwell station. Granted, my room is small, and the only real common area is the kitchen. But the only thing I need in London is a bed and a shower, I'm spending most of my time not-at-the-flat. So it feels like the inflection point between location and price.
- vegabook 11y agoWhat a beautifully presented article. So beautiful, in fact, that I didn't feel like reading the text.... I just wanted to move on to the next picture.
- venomsnake 11y agoWell ... London real estate is a textbook case or resource curse. You cannot expect anything different.