Even the wealthy can’t always afford the city’s most expensive neighborhoods these days.
You should know the script by now. A previously overlooked inner-city area becomes newly fashionable, and its housing prices start to edge up. At first, the ensuing transformation creates some buzz—a new paint job here, a new luxury shop there—but soon the population who would previously have called the neighborhood home realizes it can no longer afford the area’s rising costs. They scatter to cheaper lodgings elsewhere and the area becomes the shell of its former self. That this process is happening in London right now is no surprise. What’s more unusual is the social group that is being displaced: the rich.
According to a new conference paper presented last week by Dr. Luna Glucksberg of the International Inequalities Institute at the London School of Economics, London’s wealthiest families feel they are being pushed out of the city’s most exclusive neighborhoods. Families that raised their children in areas such as Mayfair and Knightsbridge (at least during the periods said children weren’t away at boarding school) are now finding prime London property so expensive that they are stooping as low as buying their offspring homes in farther flung neighborhoods, including Fulham, Battersea or the Georgian parts of Islington.
The news has rocked London... by prompting a citywide hunt for the world’s tiniest violin. It’s exceedingly hard to muster much sympathy for people being priced out of areas where the average resident’s life earnings could scarcely purchase a broom cupboard. And in this battle pitching the super-rich against the super-super rich, families who find they can’t afford extra space or homes for their kids in the most expensive areas will still earn millions when they sell up and choose to move elsewhere.
This plutocrat displacement angst is nonetheless significant. For a start, it displays London’s top-end globalization. Areas such as Belgravia were once synonymous with the British ruling class—Oscar Wilde fans will remember that in The Importance of Being Earnest, Jack Worthing is castigated by Lady Bracknell for having a house on “the unfashionable side” of Belgrave Square. And the area is still the ruling classes’ home, it’s just that this class is now international.
Today, 60 percent of properties for sale in this part of London go to international buyers. The general tenor of the place has changed nonetheless. In the evenings an eerie stillness settles on it. That’s because these new owners are so rich in both money and global property that their London addresses frequently sit empty, functioning more as dust-sheeted deposit boxes rather than actual homes.
The oligarchification of London’s prime spots also bodes ill for further displacement down the line, as the rich look farther afield. The areas they choose will then presumably experience price rises too, moving down the food chain until the process ultimately hits people whose greatest worry is not mummy and daddy no longer being able to buy them an apartment next door.
But is this exodus of the rich really a sign that London’s historic elite is losing its footing? Not necessarily. Much of Central London’s most expensive property is still owned by the Grosvenor Group, which is itself owned by none other than the 25-year-old Duke of Westminster. Not only does the Duke’s aristocratic lineage date back to the 17th century (admittedly making it not especially old by British standards), he is currently the richest person under 30 in the world, inheriting a fortune of around $13 billion since his father’s death in August. The parts of London the Duke owns may be in the process of being hollowed out into ever-glossier emptiness, but when it comes to raking in the profits from this evisceration, it’s still the same old faces cashing in.