The exclusive and enormously expensive suburb of Belgravia in London (house prices in the Belgravia district range from £385,000 to £17,500,000) seems to have taken on a new identity. This uber-exclusive zone has a rather ghostly air, as it would seem that none of the property owners are ever present. One of the most elite suburbs of the capital is virtually a ghost town with its residents in absentia most of the year. Make no mistake, the door lamps are on, hinting at the idea of presence, but the empty streets and stores tell a truer tale; for example, the clothing boutique that is closed during the entire month of August. Sadly, it’s not just the suburb of Belgravia that is suffering from absent owners.
Most of the apartments at One Hyde Park complex in Knightsbridge have been purchased by foreign buyers, mostly uber-wealthy Russians, Kazakhstanis, Southeast Asians and Indians. Estate agency Savills has released figures indicating that around 37 per cent of people buying the most valuable property in the capital, in suburbs like Knightsbridge, Chelsea, Kensington and Mayfair, have no intention of making them their primary homes.
It is true that London is not the only city in the world where the abundantly affluent leave their properties vacant most of the year; the same is true for famously wealthy suburbs of other countries too, like Manhattan in the United States. The difference, however, is that the properties in London are almost all exclusively foreign-owned. The trend shows a deluge of foreigners buying up entire suburbs of the capital. Many suburbs of central London have been priced out of the reach of local residents, according to a recent report by the Smith Institute, a research group based in London.
The situation has become quite worrying, and has reached the radar of British lawmakers. The impact of the empty areas is felt most acutely on the local economy, which sees no contribution from the wealthy but absent residents, save for the couple of weeks per annum they may spend visiting their London properties. It remains to be seen whether British lawmakers will pass legislation to curb the purchasing power of foreign buyers, because at the end of the day, these exclusive suburbs form part of the local and larger economy and the absence of contributions to the daily grind of stores and businesses, feeds negatively into the British economy. Lawmakers have suggested that a secondary tax be imposed on foreign-owned properties, but only time will tell whether British lawmakers succeed in bringing back the dynamism and flux of community living and engagement of residents to these elite suburbs.
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Featured image "Hyde Park, London" via Nick