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The Scandal of London's Empty Homes

31/05/2016 14:17 | Updated 31 May 2016

It would be stating the blindingly obvious to say that London has a housing crisis. But before you flip to the next article, ponder this: in a city with a chronic housing shortage, how can there be so many empty flats owned by overseas investors, and our own London borough councils?

Let's start with the 'skyscraper bank accounts' that have sprung up all along the Thames. Building flats as "buy-to-leave" investments has to be one of the ugliest expressions of how our city's housing market is broken. Say what you like about buy-to-let landlords: at least they put a roof over people's heads.

"Buy-to-leave" is a uniquely London affliction which successive Governments have failed to get a grip on. John Prescott tried to tackle it in his 2004 Housing Act: giving powers to councils to seize empty homes and rent them back out to tenants, if they lay vacant for more than two years. The rub was, empty homes also had to be "heavily vandalised", to join the programme.

The 2011 census looked at the number of "household spaces with no usual residents" - a bracket that included virtually empty second homes, as well as vacant properties. On this measure, the number of unoccupied homes in Kensington and Chelsea in 2011 was running at 10.5 per cent. In Westminster the number was 11.9 per cent. In Camden, 5 per cent, Islington 4.7 per cent and Hammersmith and Fulham 4.3 per cent. In the City of London, fully 20.7 per cent of homes had no "usual resident".

Crunching data from the Department for Communities and Local Government, we've unearthed another nasty surprise for Londoners. There are over 7,500 council houses and flats in London, just sitting empty. Incredibly, ten London boroughs have seen their vacant housing stock actually increase over the past decade. The worst offender is Ealing, which had 1,051 vacant council homes in 2015, up from 180 in 2005.

Despite the mountain of advice that the new London Mayor has already received, I hope this is a priority for Sadiq Khan's in-tray in City Hall. Yes, transport and skills shortages are among those which must be high on his agenda. But there is a consensus that the capital's biggest problem is the housing crisis. All the mayoral candidates made play rightly of the fact that London is a - and perhaps the - great world city. But unless people can afford to live here, this boast will be increasingly hollow.

Now it's not just the lower-skilled but essential workforce who struggle to survive in the city. This persistent shortage of supply is forcing highly qualified workers on which this city depends to live further and further away from the capital.

The result, for example, is that the problems that inner London schools had in recruiting and retaining teachers has spread out right across the city. There is, I am told, an exodus of exactly the experienced teachers the capital needs once the attractions of living at home or sharing student-like digs, wanes.

But as the Economist has pointed out, it's not just young teachers who have no option but to turn their backs on London. The number of twenty-somethings, whose skills and energy are the motors for the city's continued prosperity, fell by three percent between 2011 and 2014 after a long period of growth. Academics at our world-class universities are also being pushed out.

Yes, we need to build more homes, more quickly. But it is also about a better use of existing stock. Every single potential home that is left empty is a waste: pushing up local rents, and making life harder for everyone else.

Other UK cities have got the bit between their teeth. Our research found that Manchester successfully reduced its number of empty homes by more than 84%, from 10,059 long-term vacant dwellings in 2005 to 1,599 ten years later. Manchester's innovative 'Empty to Plenty' campaign offers advice and support for property owners. It helped fill nearly 1,000 homes between 2012 and 2015.

Of course this is not a magical cure for the wider problems of London's land shortages, and the difficulties of construction on brownfield sites. We also need to incentivise councils to build homes again, and to encourage a competitive mix of tenures: social, rented, and owner-occupied.

But we have to sort out our own backyard first. Londoners won't take any housing plan seriously until it tackles this issue. The new London Mayor, once he has recovered from his long and bruising election campaign, should look at what other countries and cities are doing to stop their houses being left empty.

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