THE BLOG

My Generation Needs to Rethink Property in London - It Just Ain't Worth It

12/11/2014 16:48 GMT | Updated 12/11/2014 16:59 GMT

Many of my generation (and a larger chunk of those younger than me) missed the boat with buying property in London, not having had any capital for a deposit at the crucial time. I've long ago given up on ever aspiring to owning a home in London and I definitely think that there needs to be a mansion tax on properties over one million. Some people have made such massive gains for doing nothing, and property has created such huge inequality between two generations, the likes of which, experts say, will never happen again. So a mansion tax is a minor redistribution of wealth that is very necessary in a country where, as Russell Brand keeps telling us, the divide between rich and poor is ever greater. That money could even go towards building affordable rental property. Charity starts at home.

In Quatar you can only buy a property if you are a Quatari citizen, whereas large swathes of new London property is bought by the wealthy Chinese and Russian elite who have realised buying a chunk of residential London property is far more lucrative than leaving it in the bank accruing next to zero interest. Heck, they don't even need to let it out. According to mortgage lender Nationwide, London property value increased by 28% between June 2013/2014.

The other majority is buy to let landlords, many of whom have been allowed to borrow and buy up vast portfolios at the expense of my generation. Property is supposed to be for living in, not living off. Shelter is right at the base of Maslow's heirachy of needs, yet the fat cats have been allowed to take it all and pull up the drawbridge behind them, and the rest of us are just meant to politely smile and let them get on with it.

In formerly vibrant areas, such as Notting Hill Gate, natives talk about the empty mansions and endless basement extensions that are ruining London and turning it into a soulless uber rich part time playground peppered with coffee bars and estate agents. Property is the new stocks and shares.

But though buying a London home is as out of my reach as a trip to the moon, I'm not going to feel down about it. Listening to my generation, it's clear that there are so many people in the same boat. It really is a wonder that we haven't revolted. No time perhaps? Too busy working to pay someone else's mortgage. Or is it something else? Living in London perhaps isn't something we all aspire to much anymore. My friends who live in the countryside and other UK cities are better off in many ways, and tell me that the quality of life is way better, not one regrets moving out of the big smoke.

The weird thing is, it now seems that even paying a few million doesn't buy you much of a home here, and who do you know who is a cash ready would be London buyer? Do you know any one at all who can now afford to buy a home here and feed themselves simultaneously? Yet anyone who owns a property here is forever going on about its exponential worth. But as the streets are becoming emptier, our London homes are becoming the holiday homes of wealthy foreigners, out of reach of the average income. As Oliver Twist once sang, 'Who will buy'

The ongoing rise of property prices here has been partly caused by no one wanting to cash in their chips when the prices are still going up and up and up. That's created less property available on the market, and therefore, bidding wars. The government's help to buy schemes have also added more buyers to a market where no one wants to sell. It seems Margaret Thatcher's disastrous selling of council houses taught them nothing.

Interest rates will have to go up eventually, forcing people to sell when their monthly payments become unaffordable. Will the house of cards come tumbling down then? Or will London just be a sea of billionaires here for annual holidays in their London homes? Like Venice on a larger scale, a relic, empty of its original inhabitants.

We are brainwashed into believing that ownership is what we should aspire to, hence this bubble, which of course, has benefited many financially, but it's not all it's cracked up to be, and no system in the world can keep making all entrants big cash winners. So if you aren't a London home owner, bear that in mind. Also, your million pound home owning friend will probably have a worse quality of life than you, worry over debt and fear of selling. The more recent the purchase, the worse the sweat.

And for my generation, renting needs to move in our minds from the "throwing away money" pigeon hole, to the "sensible long term option" pigeon hole. We Londoners should put our energies into fighting for renter's rights if we still want to live here. These foreign owned properties shouldn't be allowed to sit empty driving up rental costs. Plus, experts are telling us that property in London is never going to rise again like it has in the last 30 years, so why bother killing yourself trying to get a deposit for something here? London isn't the centre of the universe and we all have internet access in the UK don't we? Clacton is nice I hear...