New Building Projects By Foreign Investors Will Price People Out Of London
Housing industry experts at Molior Consulting claim that the dramatic influx of mass foreign investment in London property will price regular buyers out of the capital, with super prime properties built as ‘safety deposit boxes’ for wealthy overseas buyers. According to their figures, more than a quarter of all new developments of 1000+ units in the London area are built by foreign investors. Far from solving the housing crisis by providing new homes for Londoners, these properties more often than not achieve luxury prices that will force most average UK buyers out of the London property market. The director of Molier, Tim Craine, says that these new houses “are being built at the wrong price. A one-bed flat for £1m is not going to solve anyone’s housing crisis.”
Despite this grim outlook for Londoners, Mayor Boris Johnson led delegations in November to a number of the Asian countries with the most prominent luxury investors, promoting these housing projects in conjunction with local government schemes. The former Deputy Mayor of London Nicky Gavron, now the chair of the London assembly’s planning committee, spoke up against these investment projects, saying “Such properties often become buy-to-leave investments and don’t meet the needs of Londoners. London is in the midst of a housing crisis – what we need is mixed-income housing where people actually live.” Joan Ruddock, MP for Lewisham Deptford, is calling for tougher controls on London housing developments to balance the desires of luxury investors and the needs of Londoners for affordable housing in the capital. “The capital will not be sustainable unless people in the public services can afford to live here,” she stated, “We are pricing them out.”
The uncertain sustainability of a capital built on luxury property investment is not worrying the current leaders of London. London’s deputy mayor for housing, land and property Richard Blakeway claims that paradoxically these prime property investments in the already overpriced capital will allow for a greater number of affordable homes to be built “far sooner than would otherwise be possible.”
Big foreign investors in London property include:
Usaga Tehas Group (owned by Malaysian billionaire Ananda Krishnan) planning to transform the former St Johns Wood Barracks site into 104 luxury properties of up to £5,000,000 per apartment.
Knight Dragon (owned by Hong Kong billionaire Henry Cheng Kar-shun) building 10,000 homes on the Greenwich peninsula with 3-bed apartments costing over £800,000.
IKEA of Sweden building 1200 homes next to east London’s Olympic Park site.
Oxley Holdings, a Singaporean company, developing 3400 homes at Royal Wharf, east London.
Investors from China and Abu Dhabi supposedly will bid for the Hyde Park barracks, set to sell for £650,000,000.
Hutchison Whampoa of Hong Kong set to build 3500 homes in Lewisham Deptford.
Read more at The Guardian.