What follows doesn't alter the fact that London needs a lot of houses across every tenure but it does provide a little context and suggests that we need a better understanding of the drivers for housing demand in the metropolis. And hopefully gets us past articles filled with stuff like this:
She puts the micro-boom in Hackney down to the post-Olympics changes that have transformed an area which once had failing schools and high crime into a part of London appreciated for its architecture, parks and cafes, but which remains just affordable to people no longer able to live more centrally.
The problem with this is that discussing Hackney's delights (or the weird world in which it has become some sort of attractive neighbourhood) doesn't really help us understand "the heart of the housing bubble". It just tells us that house prices are going up in Hackney. Indeed, Hackney, like its next door neighbour Islington, has seen prices rise significantly faster than the London average.
This graph is something of an education for anyone considering London's housing situation (you can see a bigger version here):
The demand illustrated in the article above is younger, as the author makes clear:
Everyone who comes in is white, and in their late 20s and 30s, unless they are older parents accompanying their children; this demographic is repeated at each of the nine viewings and open days that Keatons allows us to attend over three days.
The question isn't just how long all this can go on before the bubble pops (the answer, if other international cities are any guide, is 'a lot longer than you think') but where are the workers going to live? Of course the folk spending £700,000 on a three-bed terrace in Hackney* will be working (very hard I suspect too) but in their offices there will be people on half the money.
For some of these people the answer is that they're at home with mum (which is not really sustainable), in expensive rented flats, probably sharing or else cramming onto a train from Southend, Chatham or Peterborough where they still have an outside chance of being able to afford either rents or a mortgage.
There's nothing new in this pattern - back in 1987 when I left London, I had a boss who commuted in from Eastborne and colleagues whose commute was from Peterborough, Maidstone and Hemel Hempstead. But it reminds us of the devil's deal we've done - constraining new build, limiting permitted development and making no compromise on London's green belt has been great news for property owners in the metropolis but not so great for the population who want to buy or rent property.
Add the time and cost of actually getting a planning permission on land you're allowed to develop and we have a recipe for a housing market so schlerotic that repeated heart attacks are simply inevitable. So I find it bizarre to hear London politicians opposing more liberal permitted development rights (converting empty shops into homes, for example), proposing daft politicies like rent controls and even suggesting tighter controls on housing development.
What we need to hear from these London politicians are proposals for planning reform. We never do though.
*We don't have these problems in Bradford. £700,000 would get you at least half-a-dozen three-bed terraces more if you're not too fussy about quality or location
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