Developers have pledged to give UK buyers in London a fairer deal, voluntarily committing to releasing properties to the domestic market at the same time as abroad. Currently, housing stock is low in the capital and overseas buyers are snapping up properties, particularly at the higher end of the market or for real estate investment. However, Britons will now be given every possible opportunity to buy a home.
The commitment from developers will be welcomed, as concern mounts that prices in the capital are traveling upwards too swiftly. Nevertheless, the Home Builders Federation (HBF) has stressed that selling to overseas buyers helps companies fund developments, so firms should not be overly criticised. Indeed, investors from abroad are helping to generate the construction of thousands of desperately needed new homes.
A survey from HBF of eight large companies responsible for 44 per cent of new homes built in London, showed that homes sold abroad have led to the construction of 14,000 affordable homes. In fact, more than GBP 2 billion from abroad was invested in British-based builders, the government received around GBP 129 million in stamp duty, and 16,000 jobs were created.
Stewart Baseley, executive chairman of the HBF, said: "Attracting up-front investment by pre-selling homes is absolutely key, and without it many developments would not go ahead. Selling some properties abroad allows tens of thousands of affordable homes as well as for rent and to buy, to be built for Londoners. London has an acute housing crisis and foreign buyers are playing a vital part in helping increase the number of homes being built in the capital. However, the industry wants to ensure that UK buyers have every possible opportunity to buy the homes being built."
Research has also previously shown 85 per cent of properties bought by foreign buyers in prime London were occupied. This demonstrates that the belief that overseas investors leave properties empty is a myth and demand for homes is genuine. What's more, on all but a few high-end developments, when buyers aren't living in properties they are renting them out - helping the housing shortage in the mean time.
- Monday 06 January 2014