Hollywood has long been obsessed with the nuclear / zombie apocalypse image, where a bold hero wanders around a once-teeming metropolis now reduced to shadows and silence. It's a seductive fantasy - as anyone who saw 12 Days Later will probably agree, the idea of wandering around a completely empty Central London does look like fun. The thing is; would it be as nice in reality if the parts of the capital usually referred to as 'prime central' actually became as devoid of inhabitants as the movies?
That's the bleak forecast predicted by an increasing number of London rental market commentators, as landlords appear increasingly happy to leave their desirable properties empty rather than renting them out. Many of our property management clients have included the likes of Foxtons, Knight Frank and Savills, all of whom, along with some of the more bespoke / boutique agencies like Druce or City West Homes, are constantly seeking out fresh stock to rent. It is, after all, the life blood of a healthy rental market. But we're increasingly being requested to carry out repairs on properties under management, and when asked what the tenants' move-in deadline is, we're told "oh, it's not being rented - the landlord's in Dubai / Hong Kong / Moscow and he just wants it maintained". Which is nice for us (no looming deadlines) and obviously nice for the landlord... but for tenants looking for such properties, perhaps because they've just relocated to London, or they want to get their families established before the school term starts, it's not so nice. In fact, with many properties now lying empty yet in perfect condition, like expensively-maintained furniture showrooms, it's becoming a real problem for those looking to rent in areas where stock is in scarce supply.
This creates some interesting likely outcomes. Firstly, while flats in Shoreditch will always enjoy a constant churn of happy tenants, an increasing number of elite houses or apartments in upmarket areas such as Mayfair, Knightsbridge and Belgravia (along with parts of Notting Hill, Chelsea and Kensington) remain empty on the instructions of absent owners. This in turn a) creates much higher demand for those that are available, which b) drives rental prices still higher and c) can sadly mean that near-empty developments or streets in certain areas actually become less desirable to live in. Don't believe me? Well, no-one's saying that upmarket tenants are necessarily looking for the sort of sense of community you'd find in a tiny Yorkshire village, with everyone knowing everyone else's business, but when we're carrying out works on a beautiful Mews House in W1, and we realise that there's more chance of seeing a tumbleweed blowing across the cobbles than of seeing real people coming and going, then it does make you wonder just how regular tenants could truly enjoy their new surroundings.
In fact, all too often when we're instructed to work on upmarket residences, the only other signs of life in the street we see are... other contractors' vans! Now, this ghost town feeling is to be expected if you visit the likes of Threadneedle St on a Sunday, when all the City boys have fled for the weekend and every shop, sandwich bar and pub is shuttered up. But when you realise that whole swathes of prime central London resemble the aftermath of a zombie invasion during rush hour on a Wednesday, then one can only assume that some deep changes have occurred to the rental market, and they're not necessarily positive ones.
So what is the underlying cause of this phenomenon? We'd have to say it's the rise of the international buyer. This isn't to attack them - it is, broadly speaking, a pretty good thing that more and more foreign money has found its way to the London property scene; it's (mostly) good for the market and it's good for the economy. But the downside of perhaps 2/3 of prime London property being purchased by international buyers (despite various levies and taxes intended to curb the trend) is that with fewer properties than ever available to rent, the types of corporate tenants who once formed the typical resident profile of Central London's beautiful squares and mews are now not even bothering with certain areas. Instead they're opting for the likes of Ladbroke Grove, Battersea, Fulham and Pimlico. Which brings us full circle to the tumbleweed scenario again.
You might also surmise that this trend results from a lack of new housing in the likes of Mayfair or Knightsbridge, but no - new-build activity in these hyper-aspirational areas remains as healthy as ever. It's just that most foreign buyers now seem content to buy off-plan and then essentially 'bubble-wrap' their acquisitions, figuring that the capital gains growth in London can match or exceed what they'd expect to receive in rental income anywhere else, without any of the hassle of wear and tear, problem tenants, breakages etc. So these gorgeous properties, that would normally have been snapped up by eager executives, upmarket families or young professionals keen to rent in London's most glamorous areas, are now moth-balled and kept in peak condition while their absent owners wait to sell them on again. Will these areas become less vibrant as this trend continues? Almost certainly. Should Londoners be worrying? Probably. Is there anything that can be done? Unless we want to live in a Socialist country, then no. It is what it is really; it's just a pity that so much of London's nicest property stock isn't resounding to the noise of happy tenants.