Even the Rich Are Being Priced Out of Central London • Hacker News Board

Re: Even the Rich Are Being Priced Out of Central London

#201

Post by Symbiote » Sat, Sep 03, 2016, 8:15 AM UTC

puranjay wrote: post #127

Symbiote wrote: post #69

Earlier quoted context omitted.

Note that £20-45k/month (US$25-60k/month) is more like the going rate for these properties. http://www.nestoria.co.uk/mayfair/property/rent/2?price_min=... But either the owner isn't interested in the money/hassle/attention, or occasionally uses the property — it's difficult to show off your fancy London apartment if people are living in it, and you can't casually lend it to friends or relatives.

I reckon people with $25-60/month to rent out these properties would already have enough money to buy their own homes slightly away from the city center

They probably do, but that doesn't mean they want to live there.

I pay $2k to live in a city centre. I could pay half that to live at the edge of the city, but then I'd be at the edge of the city.

Re: Even the Rich Are Being Priced Out of Central London

#202

Post by mercer » Sat, Sep 03, 2016, 8:38 AM UTC

mattlondon wrote: post #60

melling wrote: post #7

If only there was a way to make living within a city less important. There must be some way to move large numbers of people over "great distances" (50-100 miles) in a more commutable time.

The trains can be fast and effective over those sort of distances. The trouble is, they terminate at only a few points which tend not to be right in the center, meaning that then getting to where you need to be when you get off of the train takes longer. E.g. between Stevenage (town North of London) and Kings Cross in the UK, its about 30 miles. Trains do that in 24 minutes. But to then go the final 1-to-3 miles to y…

I really like the solution of offering 'public transport bicycles' at stations. I've used it in a number of cities in Holland and seen it in action in Barcelona and (IIRC) Paris.

Barcelona in particular seems to have really gone all-in on this solution. The city, or at least the center, is covered in spots where you can pick up or leave such a bike using a card.

In Holland it's understandably not as widely rolled out because most people have at least one bike in the city where they live, and often a second bike for the city where they work.

Re: Even the Rich Are Being Priced Out of Central London

#203

Post by imtringued » Sat, Sep 03, 2016, 8:50 AM UTC

valkea wrote: post #104

r00fus wrote: post #19

And... this is what happens when you don't tax foreign cash infusions. For those who think we should get rid of taxes on cash repatriations - this is likely an outcome.

Foreign capital investment is great, so beneficial to the economy. The problem is with the housing market. Perverse subsidies, out of date zoning laws, and a lot of nimby based lobbying. Fix these things and I doubt anyone, including foreign investors, would be parking capital in property and just leaving it unused.

Building more houses is great. Buying the same houses for increasingly higher prices is not that great.

Re: Even the Rich Are Being Priced Out of Central London

#204

Post by purplelobster » Sat, Sep 03, 2016, 8:56 AM UTC

sandworm101 wrote: post #90

I'm shocked that london, vancouver, SF and a few other cities are still functional. When working lawyers and doctors can no longer afford to live in a city, what actually happens? Are these now theme parks? Retirement villages for the uber-wealthy? Some (SF, seattle) have developed this strange mix of the very very rich and the homeless on the street. Others (Vancouver) see inverted traffic patterns as more professio…

> How do you motivate a kid who knows he has a guaranteed job at his parent's investment firm, that has trust portfolios that will support him forever?

You don't. And that's why (among other factors) most families squander their wealth within two generations.

Re: Even the Rich Are Being Priced Out of Central London

#205

Post by rahimnathwani » Sat, Sep 03, 2016, 9:02 AM UTC

randyrand wrote: post #147

ferentchak wrote: post #138

Earlier quoted context omitted.

I guess I am confused why they would not want to collect the money from renting the buildings out. Any ideas?

Eviction can be very difficult (1 year +) when it comes time to sell. Also, it's risk. They can fuck up the place, and if their rent is not much, then the insurance will be more than the rent.

That's not the case in London. The notice you need to give a tenant is specified by the lease agreement (general an Assured Shorthold Tenancy). It's usually specified as 6 months minimum, after which either tenant or landlord can give 1 month (or sometimes 2) months to end the lease.

If the tenant refuses to move out (despite the landlord serving notice correctly) you can usually get that resolved in 2-3 months at most: 1 month to get a court date, 1 month to give the tenant time to comply with what the court orders, and 1 month to get a bailiff to physically remove them (if it comes to that).

(Source: I'm from London, and I've signed several leases as both a landlord and as a tenant. I've once gone to court to evict a tenant who had stopped paying rent, and the matter was resolved in <2 months from first filling in the court paperwork)

Re: Even the Rich Are Being Priced Out of Central London

#206

Post by rahimnathwani » Sat, Sep 03, 2016, 9:04 AM UTC

ddalex wrote: post #156

randyrand wrote: post #150

Earlier quoted context omitted.

A $5 million home rents for roughly $20k a month, or $240k a year.

Probably the owner of said home makes more money than that in his/her sleep.

Passive income on capital assets (e.g. letting out property) is exactly how they make that money.

Re: Even the Rich Are Being Priced Out of Central London

#207

Post by crdoconnor » Sat, Sep 03, 2016, 10:42 AM UTC

afarrell wrote: post #17

s_q_b wrote: post #5

In DC, there's a big glut in foreign capital flowing in from foreign oligarchs and elites, particularly from Russia and China. Residential properties in so-called "safe cities" are both a form of investment and a potential life-raft should the political situation change in their nations.In addition to the artificially low supply created by extreme height limitations, this has caused prices to skyrocket. The apartment…

I feel like there is a massive opportunity to be had here from managing and renting out these places.

Many of these properties are new builds and drop in value as soon as they are 'lived in'.

Re: Even the Rich Are Being Priced Out of Central London

#208

Post by alimw » Sat, Sep 03, 2016, 12:37 PM UTC

keithpeter wrote: post #84

gwbas1c wrote: post #72

Earlier quoted context omitted.

The bubble will be forcefully burst when homeless people start squatting; or pranksters vandalize them.

Sure, the bubble bursting I have no problem with: rich people take a haircut and premises are repurposed. I walk through Digbeth in Birmingham most days: Early Victorian housing that is now car scrap yards and workshops. It all gets recycled.

Anyone who's bought recently with a full mortgage will experience a burst bubble not as a haircut but as a plummet into negative equity. I suppose you could argue that they took on the risk, and other such risk-takers have made big profits. Personally I think it's crazy that individuals are expected to make these huge gambles. But people don't seem to take seriously my suggestion of nationalising land ownership...

Re: Even the Rich Are Being Priced Out of Central London

#209

Post by paulddraper » Sat, Sep 03, 2016, 5:53 PM UTC

001sky wrote: post #199

paulddraper wrote: post #192

Earlier quoted context omitted.

It sounds like we're well balanced then. Markets are efficient.

public policy variables are outside the market efficiency hypotheisis because. markets are therfore not efficient wrt to public policy in general. they only are efficient with repsect to a specificially dilineated (analytically tractavle) public policy context at a single points of time.

And specifically what externality do you think is at play here?

Re: Even the Rich Are Being Priced Out of Central London

#210

Post by grkvlt » Sat, Sep 03, 2016, 7:15 PM UTC

TheSpiceIsLife wrote: post #137

Can anyone explain the purported benefits to society of allowing non-resident foreigners to own residential property? Who is this supposed to benefit? I mean, other than real estate agents, solicitors / conveyancer, and the initial citizen who sold the property. What prevents us (whoever 'us' is in your case) from banning foreign non-resident residential property ownership.

Banning foreign non-residential ownership is insane! You apparently want to live in a world where people are not allowed to buy a holiday cottage in France? Or prevent people from buying a city pied-a-terre and a country house? If I have the money, and I want to purchase another house in another country or city, I should absolutely be able to do so, and I cannot imagine a world where this would ever not be the case... And, to answer your question, purchasing the house benefits me, the owner. I now have my own place to stay in another country or city, whenever I want to go there.