This is London, capital of the United Kingdom, one of the wealthiest realms that has ever existed. And yet in this astonishingly prosperous city, one in ten Londoners are helplessly trapped on the waiting list for social housing. Ordinary people are fighting for places to live, often unable to find affordable council homes; they are frequently forced into the clutches of private landlords who charge them staggering rents. Meanwhile, foreign investors pounce on newly built properties to stash away as investments. This state of affairs has helped create an increasingly poor and depressed population in the outer suburbs while inner London has become the sanctum of the super-rich.
Luxury development is all about maximizing profit, and this model is a main driver of inequality in a country where for decades successive governments have failed to deliver on promises of affordable housing to keep up with demands of a growing population. As a result, the super-rich make their billions while ordinary citizens, especially the young, are being priced out of their communities and their sense of belonging through the process of regeneration.
Take the transformation currently going on in southwest London. The story of the Nine Elms revival is all about London's booming property market - which is hugely attractive to foreign investors -- and not even remotely about addressing the shortage of affordable housing. Malaysian money is flooding into the redevelopment project while Chinese cash is financing a five-star hotel project and luxury apartment complex further downriver. Of the projected 54, 000 homes (priced at a whopping £1 million each), most have gone to foreign buyers. This type of profit-driven speculation strips away the very social mix of communities.
If you thought that the first priority of development was to build homes that working class Londoners could actually afford to live in, you would be wrong. These projects are being built to sell to foreign and domestic bankers and all the members of London's loaded elite. No research is needed - just look at the price tag. Today in London, average property prices are sitting at £500,000 and monthly rents are hovering around £1500. With prices like these, the term 'affordable housing' is rendered meaningless. For the average worker (who keeps the city's economy ticking daily), owning a home has become a pipe dream.
According to the housing charity Shelter, the average single person in London will need to save for 30 years before they can own their own home. In inner London 72 percent of the average wage goes to rent, and to the renters it looks like the government is more concerned with attracting foreign development money so they can pay the bills for the regeneration of big cities.
To make matters worse, the government is forcing councils to sell off their most expensive homes, and in London this means losing substantial numbers of affordable family units. Council homes are gradually being emptied and people are being forced out by local councils so the land can be redeveloped. With local governments watering down even the most timid restrictions, the majority of property developers are missing local targets for building affordable homes. Since 2012, only one in seven council homes sold in London have been replaced. In fact, building more homes has become merely part of the rhetoric to justify the regeneration of London's affordable housing estates, accelerating the exodus of many Londoners out of their own communities, creating generational challenges, and worsening an already alarming social and cultural divide.
The whole point of the "right to buy" scheme was to counter the housing crisis and make it easier for ordinary people to one day own their own home. But home ownership in the UK has collapsed to its lowest levels in more than two decades. According to the annual English housing survey, today in England there are 11 million private renters, and the number has jumped drastically. So it seems the right to buy has proved to be a resounding success for investors and landlords, but for young people and those who desperately need affordable housing near their work, it has been nothing but ingenious political messaging. It is shocking that many young people today simply accept the fact that they will never be homeowners.
London represents the extremes of what is going on in the housing crisis in the UK, but the issue also brings to light the powerful structural forces that feed into global inequality: creating a false image of economic growth that hinges on market speculation. There is no doubt that regeneration is central to London's ability to reinvent itself for the future. It is not the idea of regeneration that is the problem, it's the way it's been done; the way the wealthy have been allowed to walk away with the spoils without ensuring that there will be affordable housing for ordinary people who need to live and work in London.
The idea of patriotism in politics today is packaged into low taxes and shallow semantics. But when it comes to taking care of the most vulnerable segments of society, patriotism often rings hollow. Putting profit over people has a tragic effect on nearly everyone's lives. There is nothing patriotic in allowing the rich in this country and the world to become richer at the expense of the wider population.
If the policy of regeneration is indispensable to the economy, then both government and developers should take responsibility to provide for the ones who are impacted the most. Regeneration should be first and foremost about the residents of the community who belong there; otherwise we really should ask this question in the coming mayoral election: who are these gentrification projects really for?