By Daniel Hunter
The London Assembly has called on Mayor Boris Johnson to research the impact that overseas investment was having on London's housing market.
The Mayor must build knowledge about overseas investment to ensure that it doesn't reduce the availability of homes for local people to buy or rent, stated the Assembly's motion. There has been a significant increase in this source of investment, which has doubled between 2009 and 2011.
The Assembly also called on the Mayor to examine the extent to which properties owned by foreign investors are kept empty or unused.
Caroline Pidgeon AM, who proposed the motion, said: “There is a real risk that overseas investment is creating an artificial housing bubble, inflating prices beyond the means of most. It’s vital more Londoners aren’t locked out of the capital, their chances of being able purchase their own homes decreasing year on year as prices are pushed sky high.
"We need to understand the effect overseas investment is having on the housing market, especially in terms of price, affordable housing and supply of homes for Londoners.
“This motion isn’t about penalising investment in London, it simply seeks assurance that the Mayor will take a strong look at the impact to ensure it will not damage neighbourhoods or price more residents out of the capital.”
Tom Copley AM, who seconded the motion, said: “Affordable housing is a huge problem for Londoners. We need more knowledge on the effect of overseas investment and its impact on housing prices and supply.
"The capital is in desperate need of new housing, and we need to avoid some areas of London becoming ‘ghost towns’ as houses are bought for solely for investment rather than to be used as homes. We need to get away from looking at houses as assets and see them as homes instead.“
The full text of the agreed at today's meeting reads as follows: “This Assembly notes the findings of the Smith Institute’s recent assessment of London’s private housing market and the impact of growing overseas investment, which more than doubled between 2009 and 2011 to reach an estimated £5.3bn a year.
"This Assembly further notes the Mayor’s recent acknowledgment that firm evidence on the effects of overseas investment is very limited.
"This Assembly recognises that accommodating London’s growing population will be one of the city’s greatest challenges over the coming years and believes that understanding the level and nature of overseas investment will be crucial when formulating future housing policy — not least to avoid reducing the availability of homes for local people to buy and rent.
"This Assembly therefore calls on the Mayor to undertake research into the effects of overseas investment on the price, affordability and supply of homes across London. The Assembly also calls on the Mayor to examine the extent to which properties owned by foreign investors are kept empty or unused.”
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