London's Current Obsession: Its Own Identity Crisis

Is London in danger of losing its soul? The question may sound melodramatic, but this is just what many of the British capital’s commentariat have been discussing over the past few days. The debate started with a widely shared New York Times Op-Ed piece, which asserted that London’s status as a clearing-house for international dirty money is warping its very fabric. Meanwhile in Monday's Guardian, another article – less eye-catching but also scathing – charted how Silicon Roundabout, London’s great tech success story, is itself being destroyed by the city’s property boom, as residential speculation pushes out affordable office rentals. Behind both stories lies a fear that is increasingly haunting the city: that London’s role as a safe haven for global money – especially through property investment – is making it increasingly unlivable. These articles have struck home because the vision of London they paint outline so many people’s fears. Even London’s laissez faire mayor has this year expressed concerns over London houses being treated as "blocks of bullion."

Barely a day goes by without a local news story about the phenomenal rise of London property values. In just the past few weeks, we've learned that price levels are "approaching madness." Depending on where you look, we will either see prices rise by a quarter in the next few years or precipitate a "Tokyo-style" crash. Next to professional spotters continually sniffing out the areas to which rapid price rises will come next, we find the Bank of England admitting that the boom is entirely beyond its control. Reports filter through of how the huge gap between London and the rest of the U.K. is only widening, as London buyers start to bid consistently 25 percent above the asking price. Such stories are not confined to property sections. With voter numbers falling hard in Central London’s most expensive areas, price rises are a political issue, and Mayor Boris Johnson is increasingly facing criticism for "selling the city to the highest bidder." Even international political stories are given a London property slant, with every bit of regional turmoil, whether it’s the Greek crisis or the current stand-off in Ukraine, pushing money towards the safety of the London market. It’s no wonder that the accusations in the New York Times have been greeted with such heightened sensitivity.