In the hours after the Conservatives won a majority at the general election, London estate agents reported a surge in luxury property sales. Shares in Foxtons rose by 13%, and more than £100m of central London property was sold in a 24-hour frenzy, as estate agents worked through the night to deal with the renewed interest from wealthy buyers. Their fears over Labour’s proposed mansion tax had been allayed, and the tax loophole for non-doms had been preserved.
Meanwhile, there is a growing sense among those on low incomes that they are being pushed out of the capital. According to a recent Oxfam report, the five wealthiest families in the UK are richer than the poorest 20% of the entire population. Nowhere is this disparity more apparent than in Tower Hamlets, located at the heart of London’s East End, which has long been associated with some of the worst poverty in Britain. As many as 23% of families here live on less than £15,000 a year, and 53% of children come from families living on unemployment benefits. Tower Hamlets is also home to the towers of Canary Wharf, a hub of banking and commerce, making the borough one of the wealthiest parts of Britain, too. Its economy, worth more than £6bn a year, is greater than that of Monaco.
Luxury apartments are now selling for millions in Tower Hamlets. Estate agents, the foot soldiers of the housing boom, armed with shiny new catalogues, describe the area as “vibrant” and “edgy”. This is estate-agent speak for “visible signs of poverty nearby” – and it is accompanied by the tacit assumption that in a few years’ time the area will be completely gentrified. I talked to people on both sides of this wave of change, as a new, fully Conservative government takes shape.
Kabir Ahmed, Holland Estate, Tower Hamlets
I’ve lived on this estate since I was a small child. I live with my wife and three children; my parents are next door. As part of the 2006 transfer of council houses to housing associations, we felt positive about the provider EastendHomes taking over; they promised extensive refurbishments.
Now, they are talking about demolishing this estate and building a 25-storey tower, all private apartments, with 120 low-rise “affordable housing” units around it. The process would displace 600 residents. EastendHomes say they will resettle everyone, but there is a waiting list of 20,000 people in Tower Hamlets – so it could be outside the borough, or even London. We’re talking about 200 families effectively being forced out of the area – separated and rehoused in different places. They say that, when the new estate is finally built, they will offer us first refusal, but we would all be scattered by then – and how much of it would be genuinely affordable?
Half the people here are leasehold owners, who have bought their flats – including me. If it goes through, we would be offered “market value” for our homes; and if we refused, the developers could seek a compulsory purchase order.
The estate is valuable because we are just two or three minutes from the City of London. They can generate a lot of income from building private homes with social housing on the side.
EastendHomes argue that the buildings here are structurally unsound and uneconomical to refurbish, which we totally disagree with. It’s very frustrating. You hear the phrase “social cleansing” being used – and that’s exactly what this is.
Tom Griffin, partner, Cluttons residential sales; inside Cinnabar Wharf East, E1; sale price £5.75m
Prior to the election, potential buyers were holding off their final decisions, waiting to see what would happen. The Conservatives winning has taken away that unknown factor, and the wealthy buyers’ fears of a Labour or coalition government’s effects on the greater economy.
This apartment – where it is, with the views it has – is unaffected by the issue of it being in Tower Hamlets, a traditionally poorer borough. Wapping is close to the city, it has fantastic views. The area represents good value for money for a very central location, with potential for growth above and beyond what the London market generally offers. There are a lot of people now seriously considering it.
Amy Berry, with her son, Robert, three, Tower Hamlets
I was living in Poplar with my two children when I got pregnant with twins. Suddenly I had four kids, but the council wouldn’t rehouse me. My partner decided we should move to Essex, but that went wrong, and I found myself on my own, with serious personal problems, and four kids with health issues.
I begged my social worker to find me a home in Tower Hamlets. My mum’s lived here for 33 years. It’s good to be back, but I’m in a privately owned ex-council flat. It’s only temporary. There isn’t anything affordable. No one can live near their families any more.
Agents David Campbell and Jessica Munday, inside Telford Homes Penthouse, Avant Garde Tower, E1; sale price £3.5m
David: Tower Hamlets has seen a wave of regeneration. Hackney is the golden child at the moment. Dalston became the coolest place in London. I almost think the more deprived and edgy the better. As soon as someone attaches the word “cool” to an area it stops being cool. Shoreditch changed from a gritty no-go area to being exceedingly trendy. Now it’s beginning to gentrify.
The market has changed phenomenally since 2011. We thought this property would be selling for £500 per square foot. Now, I’d say it’s £1,000 per square foot.
Julie Hicks, Tower Hamlets night shelter, The Good Shepherd Mission, Three Colts Lane, E2
I was given notice to leave my flat, and suddenly the bailiffs turned up. I’d been there five years. They changed the locks. Now it’s all done up and rented out to someone else. I had to take my pooch to Battersea, and I watched while they put him down. I had no choice.
The Citizens Advice Bureau found me hostel accommodation in E14. I was happy there, but they told me they were going to transfer me to Hopetown [a women’s hostel]. I went there and it looked like a prison, so I refused to go, and after that, they told me I was on my own. I became homeless. Finally I was referred here.
Mark Gallagher, Queen Victoria Seamen’s Rest hostel, E14
I left school at 16. When they built Canary Wharf, I got a job in the Tesco Metro. When I was 22, I was earning £15,000 a year, but to rent privately cost £900 a month.
I got made redundant and broke up with my girlfriend of 10 years. Things fell apart. I gave up my flat and spent three years on the street. I was drinking, smoking, and the missus wouldn’t let me see the kids. I was digging a hole for myself.
I’m living at the Seamen’s Rest now – it’s mainly for ex-servicemen and seamen, but it’s also for local people. The pressure got too much.
Mike Bickerton, head of new homes at DTZ; inside One Commercial Street, E1. 2,660 sq ft penthouse; sale price £4.25m
Go back four years and there wouldn’t have been much interest in Tower Hamlets. Now it’s trendy and vibrant, and you can walk to the Bank of England from here in 12 minutes. Tower Hamlets is one of London’s most deprived boroughs, but the area is smartening up and prices are rocketing. The local indigenous people are still there – we still have a jellied eel stand – but they’re surrounded by shiny glass and steel.
People like the edgy feel of east London, the “real London” feel: rich people living cheek by jowl with poor people. Parts of west London feel so safe and mundane.
Most overseas investors are looking for a good yield for renting, or buying apartments for their children. We have wealthy Chinese or Asian families who will put one of their kids in an apartment this size.
Kennedy Wfeko
I was 13 when I joined a gang. I got into violent situations. We protected our area, the other gangs protected theirs. When someone got hurt, there would be revenge attacks. It escalated – I’ve spent four years in prison, two years on remand, and had two convictions for GBH.
I’ve been working with City Gateway, a local charity, for just under a year now – training in dance and music. At nights I work on the London Underground as part of the repair and engineering team.
I hope I can stay in Tower Hamlets, but I won’t be able to if the prices go up. They’re putting up new flats, and making the area look nice; but they’re only considering the people who are well off, not the people who have been here for ages, and built a life for themselves.
Charlie Elish, homeless
I was brought up in Tower Hamlets, all my family live here, but it’s hard to get a place here now. The new developments aren’t for us – you’ve got to have money to get those kind of places.
When I got married, we moved to Walthamstow. But it didn’t work out between us, and I lost my place. Last year, I was living in a bedsit in Tower Hamlets. I’d been there two years. Now I’m living all over the place. To get a new place, you need a deposit, and I haven’t got one. I’m on Jobseeker’s Allowance.
It’s changed too much around here. It’s hard to get a job, it’s hard to get a property. I’d like to move out of London, to somewhere like Felixstowe, where it’s quiet and there’s a community.