Simon Hughes, MP for Bermondsey and Old Southwark, has written to the Mayor of London asking him to stand up for people on low and middle incomes and tackle head-on the impact of overseas investment in the London housing market.
Mayor of London
Greater London Authority
The Queen's Walk
London SE1 2AA
25th October 2013
Affordable housing in London
Earlier this month, Liberal Democrats in the London Assembly proposed a motion calling on you to undertake research into the extent to which properties held by overseas investors are kept empty, and the effects of overseas investment on the price, affordability and supply of homes across London.
The motion highlighted that over 60% of new build homes in central London are now being sold to overseas purchasers, and that across London a third of buyers are now from abroad. Crucially, the motion also noted that there is no firm body of evidence on the effects of overseas investment on the London property market.
In a parliamentary debate which I led in June, I outlined a range of policies that I believe central and local government should examine further. These policies could help rebalance the London housing market which currently prioritises the needs of investors over families, households and individuals on low and middle incomes.
Among policies which I propose should be considered are:
- research to develop a better understanding of the extent to which residential property is acquired by individuals who are not London residents or UK domiciled or resident or by companies not registered here;
- the use of higher stamp duty or council tax on properties bought or owned by non-EU citizens or companies registered outside the EU, or different council tax for different categories of occupation;
- priority bidding for rent, shared ownership or purchase for people who have lived in a particular local council area or country for a certain period;
- tax incentives for individuals or companies investing in affordable housing for rent, shared ownership or sale.
I hope you will act to carry out proposal 1 immediately, support proposals 2 and 4, and do what you can to make sure proposal 3 happens in Greater London wherever possible.
I am today writing to Eric Pickles, the Secretary of State for Communities and Local Government, chasing him to respond to each of these proposals.
I strongly believe that we cannot stand by and let the London housing market be dramatically and perhaps irreversibly distorted by vast sums of money from foreign investors - many of whom have never even heard of the Old Kent Road, let alone walked down it.
Policymakers must wake up from their non-interventionist slumber, act now and intervene in the housing market and tax and regulatory system, to make sure that decent and affordable homes are available to all. Otherwise, housing in London will become a mere commodity for the global super-rich.
I hope that you will respond positively to the motion put forward by my Liberal Democrat colleagues in the London Assembly and to my own proposals.
I look forward to hearing from you.
Simon Hughes MP
MP for Bermondsey & Old Southwark
Cc Caroline Pidgeon, Stephen Knight