Dead swathes of zombie town

September 17, 2014 6:09 AM

In superheated London, where stratospheric land values beget accordingly bloated developments – authorities are allowing planning policies to be continually flouted, affordable housing quotas to be waived, height limits breached, the interests of residents endlessly trampled. Places are becoming ever meaner and more divided, as public assets are relentlessly sold off, entire council estates flattened to make room for silos of luxury safe-deposit boxes in the sky. We are replacing homes with investment units, to be sold overseas and never inhabited, substituting community for vacancy. The more we build, the more our cities are emptied, producing dead swathes of zombie town where the lights might never even be switched on.

The Guardian's architecture and design critic Oliver Wainright discusses housing development policy in London and the new city it is ushering in.

More architectural discussion of the "new" London can be had over at Owen Hatherley's Urban Trawl, who has his recently provided his own commentary on what's happening to the city's built environment.

posted by Sonny Jim (19 comments total)

These days I hardly recognize my former metropolis, which now appears like an old flame who has undergone too many cosmetic surgeries after spending too long in the company of the nouveau riche and the next-gen aristocracy. New York is undergoing the same thing, too.
posted by Doktor Zed at 6:18 AM on September 17, 2014 [4 favorites]

Tax any vacant dwelling at a higher rate than one which is occupied.
posted by aramaic at 6:27 AM on September 17, 2014 [10 favorites]

I feel the main problem around Section 106 and requirements for affordable and social housing is that it often represents the only opportunity for local government to get money from developments. Because Council Tax is almost a flat payment on more expensive properties local authorities will never realize the benefits of any "high end" development. With a more progressive property tax local government could decide developments on their own merits and use any resulting tax gain to fund service and housing improvements themselves.

It would also, hopefully, put a slight dampener on overseas sales of property for investment only. It should encourage, at the least, keeping the property let to offset the tax.
posted by Thing at 6:46 AM on September 17, 2014 [1 favorite]

That would get pretty complicated, because what you don't want to do is tax unrented units (i.e. punishing people for building more when housing is scarce). You'd have to like, have a tax on rent that would could be refunded if the tenant could establish legal residency in the same municipality as the apartment. But this would be complicated too; it sort of demands the problematic "residency permits" that have been a tool for racism and discrimination.
posted by vogon_poet at 6:47 AM on September 17, 2014

aramaic: "Tax any vacant dwelling at a higher rate than one which is occupied."

That'd require a council tax system that's based on actual property value or increase in value over time, instead of a banded system where the amount you can be charged yearly is a percentage of the property value in 1991.

At the moment, even if the law didn't allow council tax to be cut by 50-100% for vacant properties and we levied 150% or 200%, it'd still be absolute pennies relative to the paper value of the properties and the benefits to the very rich of parking their money in London brick and mortar.

London will have a property bust one day and it will be spectacular. But as usual, it'll be the poorest that will suffer. The rich will move their money to another global city and give precisely zero fucks about the wreckage they will leave behind them.
posted by Happy Dave at 6:47 AM on September 17, 2014 [6 favorites]

The Battersea redevelopment is just absurdly emblematic -- of all the supposed residences that are really just vaults for storing capital, it's the one that actually looks like a giant safe. It's like something from Iain Banks' more surreal works like "The Bridge" or "Feersum Endginn"; dreamscape architecture from some weird mental iconography, weirdly disconnected from the world of people living an actual waking life.
posted by George_Spiggott at 6:56 AM on September 17, 2014 [2 favorites]

The Battersea redevelopment is also emblematic of how little trust there is between planners and developers. Fearing that, once again, a developer would seek to destroy Battersea Power Station rather than redevelop it, there is (was?) a condition that the towers can only be taken down and anewed one by one.
posted by Thing at 7:13 AM on September 17, 2014 [2 favorites]

Councils in London already have the power to penalise owners of unoccupied homes, but many aren't using it - especially in the areas where overseas property ownership is highest: http://www.bbc.co.uk/news/uk-england-london-28349374.
posted by kerplunk at 7:42 AM on September 17, 2014

Tax any vacant dwelling at a higher rate than one which is occupied.

Why would they want to do that? Vacant houses mean tax revenue with no service consumption. It's free money as far as the municipality is concerned. It's like coming into a restaurant, paying for a full meal, and walking out before the food is served. Every day, forever.

Politicians will always play lip service to affordable housing when it's expedient to do so, but a city full of absentee taxpayers creates opportunities for bureaucratic expansion and goldbricking that you just don't get with pesky residents.
posted by Kadin2048 at 7:43 AM on September 17, 2014 [3 favorites]

I just finished reading Moorcock's Mother London and wow, was it prescient.
posted by Kitteh at 7:53 AM on September 17, 2014 [1 favorite]

Why would they want to do that? Vacant houses mean tax revenue with no service consumption.

The equivalent of property taxes in the UK is so low as to barely mean a rounding error to government income. The highest band of council tax in Chelsea is 2k GBP a year. Add into that a very attractive tax scheme for non-doms and really, these places do a lot to drive affordability higher without meaningfully increasing the tax revenues.

It makes the cost of carrying London property so low its very attractive as a place to stash cash.
posted by JPD at 8:18 AM on September 17, 2014 [2 favorites]

JPD, thank you for that explanation. That makes me wonder: if I assume that many of the property owners who are storing their wealth in London real estate are also not local voters, what is stopping the councils from changing their tax laws?

That is, why wouldn't all the locals push to get the tax scheme altered? Are they really that much more worried about their own tax bill increasing, and less concerned about the potential benefits to their community? Or is it because the people it would help -- the people who can't afford to live in London -- are not voters in those areas?
posted by wenestvedt at 8:54 AM on September 17, 2014 [1 favorite]

This suggests the option of introducing a property tax with a full exemption for one's primary residence. Seems impossible under a Tory or New Labour (aka Tory Lite) government, though. Much depends on the extent to which the homegrown moneyed class is sharing in the spoils of the current regime.
posted by George_Spiggott at 8:58 AM on September 17, 2014

That makes me wonder: if I assume that many of the property owners who are storing their wealth in London real estate are also not local voters, what is stopping the councils from changing their tax laws?

I wonder whether it has anything to do with the City of London; a feudal throwback turned model post-democratic corporate oligarchy (it is elected by corporate tenants, with votes apportioned by global headcount), it has power far in excess of the square mile of land it administers. It pretty much determines the UK's economic policy, its police force has UK-wide remit for prosecuting intellectual-property piracy (i.e., enforcement of rents) and Westminster is beholden to it, through the office of the Remembrancer. I wonder how much sway it has over other boroughs of London, and whether this is directly (through some ancient ceremonial mechanism repurposed for the needs of the Stakeholders) or through a compliant Westminster?
posted by acb at 9:04 AM on September 17, 2014

That is, why wouldn't all the locals push to get the tax scheme altered? Are they really that much more worried about their own tax bill increasing, and less concerned about the potential benefits to their community? Or is it because the people it would help -- the people who can't afford to live in London -- are not voters in those areas?

Who is going to lead the campaign? Several newspapers and many politicians are controlled by people who are less than honest with their taxes. The issue will not gain political "traction" except by an extraordinary undertaking. Rather than convincing voters to vote against it they simply keep the issue off the political agenda.
posted by Thing at 9:12 AM on September 17, 2014 [2 favorites]

I assume that many of the property owners who are storing their wealth in London real estate are also not local voters, what is stopping the councils from changing their tax laws?

I don't know about London, but in the good ole USA the developers and the rich just pour their money into local elections or media campaigns to make sure this doesn't happen. It's almost like voting is meaningless!
posted by bradbane at 9:37 AM on September 17, 2014

I wonder whether it has anything to do with the City of London; a feudal throwback turned model post-democratic corporate oligarchy

No No one really lives in the City of London. This has almost nothing to do with that.

However the favorable non-dom taxation is certainly a big issue for the finance community in London and something campaigned for by them.
posted by JPD at 9:43 AM on September 17, 2014

The highest band of council tax in Chelsea is 2k GBP a year.

Damn, that's cheap! What services are covered by council tax? I pay more than that in property taxes and I live in a small house in an inexpensive lower middle class area in the Midwest.
posted by MikeMc at 4:39 PM on September 17, 2014

Councils are funded by a mix of central government funding, council tax, and whatever they can raise via parking fines and things like that. It's hard to tease out what is paid for by council tax and what is paid for centrally - it all goes into one big pot. Councils pay for schools, social services (which includes children's services, nursing homes and home care), social housing, refuse collection, parking, planning and development, leisure centres and sport - basically everything except the NHS, military and the benefits/pensions system. In London TFL runs the roads (funded centrally by the mayor) but outside of London that is council run too. This is my local council website, gives an idea of what they do.

Bear in mind people use fewer services in Chelsea - for a start a lot of those properties are empty, and those who do live there have the money to pay for private nurses instead of using council home care, and they also just won't need things like social housing or use things like Surestart. So council taxes are often lower in richer boroughs because council spending is lower (also in poorer boroughs more people are exempt, so those of us who do pay, pay more). Council tax is paid by the resident, not the owner, so renters pay not the landlord.

We have such a weird system because it was brought in hurriedly to replace the hugely unfair poll tax, which itself was brought in to replace the similarly broken rates system.
posted by tinkletown at 2:35 AM on September 18, 2014