'Non-doms' and 'buy-to-leave' investors are killing London
- By Rob Welham
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E-mail China.org.cn, February 17, 2015
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Vast swathes of London are being bought up by foreign investors and leaving parts of the capital like a ghost town. |
House pricing in central parts of capital cities like London is notoriously high, making them unaffordable for most ordinary people. At the same time, there are more than 70,000 empty homes in the British capital, accounting for more than 10 percent of the country's total numbers.
How could this have happened?
Vast swathes of London are being bought up by foreign investors and leaving parts of the capital like a ghost town. And as populations dwindle in parts of the city, local businesses are seeing a decline in trade, forcing some to shut up shop.
The latest victim to the growing trend of "buy-to-leave" was one of London's best loved French restaurants, Racine, which finally shut its doors after a little over 12 years serving up such classics as c?te de boeuf with Béarnaise sauce and veal chop and Roquefort butter.
Despite being a favorite of the singer Bryan Ferry and the American actor and producer Harvey Keitel, such kudos was not enough to pay the bills. Owner and chef patron Henry Harris said he had made the decision largely because of a falling clientele as well as rising rents and other costs.
"The non-doms have bought up large chunks of central London and then only live there for certain months of the year," Harris said.
So-called non-doms, or non-domiciled residents, have changed the face of London and other parts of the country. According to research consultancy Molior, in developments of more than 20 units across London, over 70 percent of new-build sales in the ?10,700 to ?16,000 per square meter range were to investors, with some "held as permanently available hotel suites" by the owners.
Some property investments are even making money for their owners before they've even been built. A flat in Battersea in West London made the headlines in November after it was revealed to have been bought for ?1 million in the spring but was later put on the market for ?1.5 million less than 8 months later despite not even being built.
The effects of all this buying-up are not only creating ghost towns, it's also driving up property prices for ordinary Londoners who are struggling to find affordable homes in the capital.
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