The UK is preparing to launch the most comprehensive inquiry into the impact of foreign investment flooding London’s housing market, London mayor Sadiq Khan told The Guardian newspaper. The move comes as overseas investors buy homes in the country, and London in particular, at a record rate.
“It’s clear we need to better understand the different roles that overseas money plays in London’s housing market, the scale of what’s going on, and what action we can take to support development and help Londoners find a home,” Khan told the UK newspaper. “That’s why we are commissioning the most thorough research on this matter ever undertaken in Britain – the biggest look of its kind at this issue – so we can figure out exactly what can be done.”
Some experts are predicting the current scale of global investment in UK property could rise significantly during the next ten years, with much of this interest coming from Asian buyers. CBRE predicting that only three percent of the potential investors in overseas property had been from Mainland China, but that trend looks set to increase. Research from Knight Frank revealed that Chinese are the biggest buyers of new-build residential in the world, with the Singaporeans second and the British fourth.
“I think it is just beginning,” Victor Li, a director of international project marketing, stated. “It is a big market, and they are getting wealthier and wealthier.”
And these overseas buyers aren’t sticking to London where new stamp duty rules have made property purchases less attractive. They are now focusing on towns and cities throughout England including Manchester, Liverpool and Birmingham Even cities in London’s outer suburbs and satellite towns which were once an afterthought are being marketed to Chinese buyers.
Some, however, think the focus on overseas property investors has been overblown. Yolande Barnes, director of Savills’ world research department, explained to The Guardian that foreign buyers accounted for only seven percent of property purchased across Greater London with most coming in select, inner city areas.
