Mayor of London Sadiq Khan comes under mounting pressure as the London Assembly demands an investigation into the impact of overseas investment on the capital’s housing market
In a motion agreed on Tuesday (7 June), London Assembly members blamed foreign investment for ‘contributing to the capital’s housing crisis in terms of both affordability and availability’.
The motion adds: ‘The mayor has a duty to fully investigate and report upon overseas investment in London’s housing market… to ensure that homes remain affordable for local people to buy and rent.’
The London Assembly called on Khan to ‘examine the extent to which properties owned by overseas investors are kept empty or unused; and to commission research into the effects of overseas investment on the price, affordability and supply of homes across London as a matter of urgency’.
This comes amid mounting concern over the levels of foreign ownership of homes in London, after it emerged last month that 40,000 properties in the capital belong to offshore companies.
According to the Guardian, the majority of homes in Britain’s tallest residential skyscraper - The Tower, One St George’s Wharf in Vauxhall designed by Broadway Malyan - are foreign-owned and many only lived in for part of the year.
The revelations prompted Khan to attack the use of homes as ‘gold bricks for investment’ by some overseas buyers.
Building 50,000 homes a year, to be offered to Londoners first; making half of all new homes ‘truly affordable; and a ‘Homes for Londoners’ living rent set at a third of the average local wage, are among Khan’s policies.
Responding to calls for an investigation into foreign ownership of homes in London, James Murray, deputy mayor for housing, said: ‘Sadiq Khan was elected on a mandate to fix London’s housing crisis and he is already working closely with partners from across the sector to build more genuinely affordable homes for Londoners and put right the appalling housing mess left behind by his predecessor. The mayor welcomes foreign investment into London property if it results in more genuinely affordable homes being built for Londoners.’
He added: ’However, he is deeply concerned that the capital appears to be a leading destination for many of the world’s off-shore companies, with many new homes appearing to be left empty. He has begun to look into how best to approach this matter, and he is calling on the government to ensure that all foreign companies are as transparent as UK companies if they wish to hold property titles in the UK.’
Caroline Pidgeon, the Liberal Democrat member of the London Assembly who proposed the motion, said: ‘The primary reason for investigating the real impact of overseas investment in London’s property sector is that we need to fully understand its impact on the price, affordability and supply for Londoners. Properly examining these issues should also reveal the driving force behind the design of some of London’s new buildings.’
Peter Murray, chairman of New London Architecture, told the AJ: ‘I would welcome proper research. I would not want to put off overseas investors but we need to make sure that we get the right amount of affordable housing and we tax people who leave places empty.’
Merely investigating foreign ownership of the capital’s housing stock does not go far enough, according to Simon Elmer of campaign group Architects for Social Housing.
‘Foreign, or indeed, home investment in what have accurately been called ”deposit boxes in the sky” would cease if the land on which to build them was not available,’ he said.
‘That means introducing measures to stop the social cleansing of London’s council estates, for it is on public land administered by local authorities that the vast bulk of London’s luxury apartments for investment, rather than living in, are being built.’