They don't want to make a few percent on their capital?
http://www.nestoria.co.uk/mayfair/property/rent/2?price_min=...
But either the owner isn't interested in the money/hassle/attention, or occasionally uses the property — it's difficult to show off your fancy London apartment if people are living in it, and you can't casually lend it to friends or relatives.
I pay $2k to live in a city centre. I could pay half that to live at the edge of the city, but then I'd be at the edge of the city.
How exactly do they pay utilities/etc without anyone noticing their transfers? But I don't believe they are successfully hiding anything in any case, governments want everyone to be guilty of something so they can achieve whatever political outcome they need through selective enforcement.
If they're getting an absurd percentage increase from property values alone, an extra few percent won't make a difference.
Not everyone min-maxes their capital. Governments probably end up eating them through inflation and taxes in the long run (but in the long run, we're all dead).