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With the U.K. election over and the Conservative Party installed in Parliament with a surprise majority, the U.K. housing market can go back to business as usual: A nationwide shortage of new homes driving already-crazy prices higher. The lack of supply, which everyone acknowledges is the problem, seems to defy a solution. And nowhere is the insanity more evident than in London.
A house went on sale on my street in north London right after the election outcome ended the prospect that a Labour government might cap the rents landlords can charge, impose a so-called mansion tax and send foreign investors scuttling. Its price, probably not coincidentally, is 2 million pounds ($3.1 million) -- exactly where the mansion tax would have kicked in.
Judging from the estate agent's brochure, it's very similar to a smaller property I bought less than three years ago, for a heckuva lot less than 2 million quid. And believe me when I say that I don't regard this as a good thing, no matter what my mortgage lender probably thinks. Who wants to live through another boom-to-bust cycle in housing prices?
Brixton, an area of south London, has been "up and coming" since I moved to London a quarter-century ago. Infamous for its 1980s riots, Brixton last month was the scene of an anti-gentrification demonstration that ended with the police using tear gas against protesters. It seems Brixton has finally arrived: Photographs from the rally show police officers guarding a branch of Foxtons, a London-based realtor.
Over the weekend, a friend of a friend explained that, while she supported the protest, she would have felt awkward taking to the streets herself, since that would have meant leaving her gated community (complete with swimming pool) in Brixton to wave a placard. Talk about middle-class dilemmas.
Read Full Story: London Real Estate, Beyond Insane
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