Some good news from New Zealand where they seem to realise what the problem is! Unlike Sajid Javid who (correctly) states that the housing market is broken, but has the wrong solution!
Jacinda Ardern, New Zealand’s new prime minister, has just announced a ban on selling properties to foreigners. New Zealand has become a safe haven for the world’s hyper-rich, scared that Donald Trump will start Armageddon. Buying a bolthole safe from doomsday has become the fashion in Silicon Valley, as well as among global oligarchs. New Zealand house prices shot up by 10.4% last year.
In Britain the phenomenon of foreigners buying property to mothball as an investment is a London disease, spreading elsewhere. The capital’s latest monstrosity is Versace Tower in Nine Elms, not due to be finished until 2020, but with 170 flats already sold, the top-floor duplex costing £13m. The London Evening Standard, with breathless adulation, describes how everything is Versace-branded, the big V stamped on its gold-filigree chandeliers. Who is buying? Gulf states, Hong Kong, Russia, Iran, Pakistan: “Most of them already have several homes,” says the tower’s agent.
Another hideous blot on the skyline is no more than gold bars in the bank, joining acres of vacant, dead-eyed streets. Kensington and Chelsea – where the Grenfell Tower fire happened – is the only London borough with a shrinking population, due to empty property bought as investment. Land used for luxury emptiness has gone for ever: the London mayor reports 80% of new property built is only affordable to 8% of London’s population. Where are those on ordinary incomes to live?