London Mayor: Sky-high Prices of London Houses Risks ‘Brain Drain’

By Steve Punter (Sadiq Khan MP) via Wikimedia Commons

Sky-high prices of properties in London could prompt a “brain drain” in the city as the workers are driven out of the capital.

Sadiq Khan, the Mayor of London, says that bosses have informed him that affordable housing is one of the biggest threats that they face in retaining and attracting staff.

Despite increases in property prices in the capital slowing down, the cost of an average home in the city is still nudging at £600,000.

That is considered to be way out of reach for the majority of the workers. According to the Office for National Statistics (ONS), the median gross annual wage for people who are working in inner London is at £34,900 – that means that half earn more than this and half earns less.

What is more, renting is also made increasingly unaffordable to many – even if they can look for a suitable place.

Khan informed reporters: “The biggest issue raised to me by chief executives and other employers is the housing crisis – the fact that they can’t get staff in London because of the cost of housing.

“That is why we are trying to rapidly increase the number of genuinely affordable homes in London. It is crucial because otherwise Londoners aged between 30 and 40 are leaving London because they want to buy a property, go from a flat to a home, and what you don’t want is a brain drain.”

The most recent report from Countryside, leading property agents, reveals that rents in London increased faster as compared to any other region for the third month in a row.

It currently costs on average £1,686 per month to rent in the capital, some 3.1 percent above the level of last year.

The government of the United Kingdom has gone on the offensive regarding the issue of housing, with Theresa May, the British Prime Minister urging the developers that possessed planning permission to “do your duty” and build on land or lose the permit.

Philip Hammond, the British Chancellor, used his autumn budget to pledge that 300,000 new homes would be built per year.

However, over the weekend, it also emerged that the £817m that is allocated for affordable housing and some other projects in cash-strapped local authorities has been returned to the Treasury because it was unspent.