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Speculators cash in as homelessness grows

While homelessness grows and people struggle to pay exorbitant rents, rich property speculators in central London are cashing in.

There were 52,960 households in temporary accommodation in England when the figures were last updated six months ago. They include an estimated 70,000 children who have no permanent roof over their heads.

Homelessness has risen 25% over the last three years. And the official increase back in 2011 was itself the largest in nine years. Over the last year, 5,700 people were sleeping on London's streets while some one million are on council waiting lists for a home.

This does not take account of 400,000 “hidden homeless” – those who squeeze into the homes of families or friends and never make it to the council lists.

The ConDem cap on housing benefits, currently claimed by some 660,000 people, will make many more homeless in the months to come.

The right-wing free-market Institute of Economic Affairs notes that:

Runaway housing costs have become one of the most pressing issues for low-income households in the UK. House prices have doubled in real terms since the mid-1990s alone, from an already very high level. No other developed country except Australia has experienced a price explosion of such a magnitude.

Shelter, the housing campaign, estimates that 3.6 million children in the United Kingdom live in poverty after their housing costs have been paid.

When it comes to buying, most new households are priced out of the market. But for those speculating in property, soaring prices are truly wonderful.

Yes, that will be the super rich who are buying up luxury apartments at One Hyde Park. They include British entrepreneurs, Russian and Ukrainian oligarchs, Nigerian and Arab oil billionaires.  

One tax-haven sleuth has found that five flats in London were bought for a total of more than £82 million by a group of Isle of Man companies under the name of Rose of Sharon.  Ukraine’s wealthiest man seems to have bought two flats in Hyde Park for £144 million.
Despite forking out such astronomic sums, of course, you won’t find many of the billionaires actually living at these properties. In the case of One Hyde Park, only 17 out of the 76 apartments will actually be lived in. It’s an investment and buying through a company means that the owners can avoid a lot of tax.

There is an inverse relationship between the haves and the have-nots. The higher property prices soar, the harder things are for those lower down the scale. Even middle-class professionals are finding themselves priced out of the market.  

The solution to the housing crisis lies within the problem itself. There are over 300,000 long-term vacant properties in England alone. Housing practitioners have long proposed creative ways of bringing them back into use.

Instead of property developers, land speculators and private landlords controlling the supply and price of housing, we need a housing programme that works for people.

Immediate measures are needed:

In short, a housing strategy designed to meet need and for ecological care rather than as a source of income or profit for developers, speculative builders, investors and landowners.

Corinna Lotz
A World to Win secretary
12 March 2013

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