Most industrial nations can attribute much of their economic success to their abilities to mobilise a work force and move them to where they are most needed. The ‘Industrial Revolution’ of the UK was down to our ability to mechanise agriculture and release vast numbers of workers to train in burgeoning industries. In order for that to happen vast numbers had to be transplanted in new ‘industrial’ areas, they had to be transported and housed.
In recent times, Europe has become a single market and again vast numbers of workers have migrated and emigrated, matching their skills to opportunities in the jobs market. London can attribute its enviable rise in the financial sector to its ability to attract the very best workers from Europe and around the world. However, workers do not just relocate willy-nilly. London attracts a more sophisticated type of worker and their needs are social as well as economic. The standard of living is very much a part of their decision to work in London – and a very large part of that is their home.
If you have the right work ethic you can do well in London as many have found, whether they be from the UK or from overseas, there are opportunities to better yourself and the situation of your family, children and all. However, if you put a break on their ability to move around the capital or hinder their progress up the property ladder, they may start to reconsider whether London is the place to be for them.
I would argue, from my experience at the property ‘coal-face’, that the high SDLT rates are now effecting people’s decision making and that the high moving costs are putting a break on the ambitions of London as a whole. There are many bands of wealth in London, but realistically in the market for £3m – £7m homes we are not dealing with UHNW or even HNW buyers. These buyers are both often working, paying for child-care and helping take the strain off the public educational system by opting for the private sector. They are also often using private health services – thus in effect also relieving the National Health Service. Their income taxes and National Insurance contributions are a very important income funding these very important public services.
There is a huge risk of squeezing this very important ‘middle-class’ sector too hard. I sense this immensely with the costs involved in moving home. Finding the odd £400,000 for a £4m purchase of a standard house is not an easy task for most people – and it is stopping people moving when they really need to.
I sense a danger that quality people will be put off coming to London due to what amounts to a crisis in London. London will lose out and the country as a whole as it is starved of its most valuable resource – people!