Ten foreign investors own sites for 30,000 homes: Plans fuel fears that Britons could be priced out of capital's housing market
01-11-2015
- Ten developments in London reportedly being sold to overseas investors
- Buyers see London as an investment - homes offered to foreigners first
- Critics label homes 'safety deposit boxes' as many owners never live there
- Investors are from Hong Kong, China, Malaysia, Australia, Singapore and Sweden
By Laura Chesters City Correspondent For The Daily Mail
Just ten foreign property developers are behind plans for tens of thousands of new homes across London, fuelling fears that Britons will continue to be priced out of the capital’s housing market.
The investors from Hong Kong, China, Malaysia, Australia Singapore and Sweden own sites earmarked to create more than 30,000 properties.
Overseas buyers regard London property as a stable investment. The increase in sales has led critics to label the homes ‘safety deposit boxes’, with many of the owners never actually living in the properties – or even visiting them.
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In April, the Mail reported how Chinese investors were creating a national housing shortage.
Developments in St John’s Wood in North London, the Greenwich Peninsula and the Olympic Park are reportedly being sold to overseas investors – with many of the homes offered to foreigners first.
Swedish furniture retailer Ikea is developing 1,200 homes next to the Olympic Park in East London, while a Malaysian consortium is redeveloping Battersea Power station in South London, which will include thousands of new homes.
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A company run by Malaysian billionaire Ananda Krishnan plans 104 luxury homes on the site of the former St John’s Wood barracks in North West London, where homes could sell for more than £5million each, while a subsidiary controlled by Hong Kong billionaire Henry Cheng Kar-shun plans 10,000 homes in Greenwich, East London, including three-bedroom apartments costing more than £800,000.
There is interest from Middle and Far Eastern investors for Hyde Park barracks in West London, which the Ministry of Defence is selling for £650million before its conversion to homes, and Singapore developer Oxley Holdings is planning 3,400 homes in Royal Wharf, East London.
Nicky Gavron, the former deputy mayor of London and chairman of the London Assembly’s planning committee, told The Guardian: ‘There is a perception these major residential developments backed by international money, particularly in super-high towers, only serve a market for overseas investors who want to buy a luxury flat in a skyscraper to treat as a safety deposit box.
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'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.’
Other developers are selling large numbers of flats to overseas buyers at Canary Wharf, King’s Cross and Earls Court.
London property prices have soared, driven by demand from oligarchs and billionaires looking for a safe place to put their money.
The average homeowner saw their property rise in value by £81,000 in London in a year, according to the Zoopla website – a rise of 15.6 per cent, compared with 6 per cent for the country as a whole.
The average London home is worth £603,724, compared to £268,895 for the rest of Britain.
But experts at the estate agent Savills claim that in a city where 37 per cent of residents were born abroad, most international buyers actually live and work in London, with those from overseas buying homes for investment accounting for just 7 per cent of all Greater London residential transactions.