Property Porn

Having rented in the Royal borough for numerous years, I have recently been contemplating buying my own little pad elsewhere in our Capital city. Over the past few weeks whilst looking for a home, I seem to have acquired a new addiction in this arduous process… property porn! Admit it people, I know I’m not alone. We are all at it, searching Right Move, Zoopla and estate agents websites for pictures and prices of our neighbours homes, our old homes, homes we would like to live in and might one day be able to afford, homes we would never want to live in and homes we know we will never be able to afford. I cyber-roam the lot, for the purposes of financial calculations, for reassurance, for ideas of what I would and wouldn’t like, for seeing how envious and grateful I can become with each the click of a button.

I find it quite amazing how insanely lustful or violently repelled a furniture choice or colour scheme can make me. I naively used to believe that this was something only my grandmothers age group were concerned with not “youngsters” like me, yet having discussed this topic with friends, they too seem to be quite caught up with the world of property. The simple Cluedo-like floor plans online are an added bonus; a little alcove in the living area to set up my photo wall and high tech speakers? Sold – one boundlessly charming, if totally pointless feature is all I need.

Imperial Wharf

I do however draw the line at mega-mansions; the enormous piles bought by Russian oligarchs, international financiers and the like, gutted and refilled with ballrooms, sports halls, state-of-the-art everything’s, golden gewgaws and topped off with helipads. Yes, I like to fantasize and look at things way, way above my pay grade, we all do, but the houses of the truly limitlessly rich are another order of magnitude altogether.

Let’s take a look at a couple of current examples – a Grade II-listed, 13 bedroom Italianate villa built in the mid-1850’s in Kensington Palace Gardens (a street nicknamed with not an iota of inaccuracy or exaggeration “Billionaires Row”) currently being renovated by Russian born tycoon, Leonid Bravatnik. When the builders have finally finished installing the gym, the 3 screen cinema, the massage room, the multistory underground car park and the 25-foot swimming pool leading to a sheltered grotto, the property for which he paid £41 million in 2004 will be worth an estimated £200 million. Shockingly, this is still £50 million less than the UK’s most expensive home –  an Arab owned Regency mansion near Buckingham Palace which has a double staircase leading to an enormous ballroom and is 30 times bigger than the average London home.

Mega-mansions do not excite any envy within me, they are far too ludicrous for that. Sure, you may think 18 bedrooms, 16 bathrooms and a garden the size of the British countryside would be thrilling, but it just doesn’t do it for me. My jealousies are instead stirred by comfortable, well-appointed homes because they seem, in a superficial way, to suggest the inhabitants lead the kind of secure, happy lives to which I aspire for myself. Mega-mansions are not about that at all.

Floor Plan

Firstly they remind us all how much money there is in the world and how much of it is concentrated in the hands of so very few people. They remind us that these people have more money – far, far more money – than they could spend in a dozen lifetimes. They remind us that when it comes to gathering wealth, there is no such thing as enough. With a few notable exceptions like Bill Gates and Warren Buffet, people rarely simply stop and say “my happiness is no longer significantly increasing with every million I make, so I will stop using it to build over accessorised homes and start redistributing it instead”. These ostentatious palaces are all about shoving bank balances down other people’s throats to highlight their successes and in some way compensate for what is perhaps missing elsewhere in their lives – satisfaction.

Property in London has become a global reserve currency for the world’s richest people to park their money at an annualized rate of return at approximately 10%. The gap between London house prices and those in the rest of the country is at a historic high. The reason for this is in 2011, at the height of the euro zone crisis, residents at the epicentre of the cataclysm – Greece and Italy – bought £400 million worth of London bricks and mortar. Fearing the single currency would collapse the rich Greeks and Italian’s got their money out of euros and stashed it here in the UK, where the government (despite how much we may moan) is relatively stable and the tax regime is gentle – very, very gentle.

It may seem cynical but the UK tax system works for these incredibly rich and powerful individuals in the same way as it does for incredibly rich and powerful companies like Starbucks (who claim they make no profit in the UK – apparently those outlets on every corner are just charity coffee dispensers) or Amazon (no corporation tax paid on the £7.5 billion sales generated here in the last three years). The city for the super wealthy is essentially a tax haven with great theatres, free museums and formidable dining. If you can demonstrate you have a residence (whatever the size) in any other country you only pay tax in the UK on your British earnings. The savings on property taxes in the UK are phenomenal.

From the top of Parliament Hill in Hampstead if you look east towards the Olympic Park and beyond you will see clumps of high-rise apartment buildings sprouting like toadstools in a meadow after a heavy downpour. These flats aren’t being built to meet the UK’s calamitous shortage of affordable housing in the capital; they are studio and one bedroom apartments financed by “bonus babies” who barely glance at the blueprints before putting their money down with no intention of living in what they have bought but instead collecting decades of rent. Along with European investors there is hot money being spent from China, Singapore, India and other fast growing economies. When I say property is money, I mean it.

Nothing is stopping these people getting wealthier and wealthier and (as these things march in lockstep together) more and more powerful. I feel that the next phase of London’s history will be one of transience, with no one having any real allegiance to the city. I wonder if those storing their money in our buildings will ever be able to provide the communal sensibility in order for the city to survive the inevitable shocks and changes it will experience in years to come and whether the delicate social ecology that makes London such an amazing city will be nurtured as it was in years gone by.

How this story will end doesn’t bare thinking about, it seems a reasonable bet though to believe that those who use London property as another form of money are not thinking about that at all. As I say, these super homes and their owners are fascinating in their own way but give me a humble home with a floor plan and umpteen photos from every angle oh and a fireplace you say… ahem, where do I sign.

Sophie x

Advertisements