Boris Johnson, the Mayor of London who has waved through planning consents for projects such as Croydon’s £1 billion Hammersfield development which undertakes to provide a very small amount of “affordable” new homes, is now calling on London boroughs to impose “punitive levels of Council Taxes” on overseas buy-to-let investors who leave their properties in the capital vacant.
Johnson was speaking in a BBC London television interview, and was responding to claims that many of the high-rise blocks being developed in London are being aimed at sales to “dirty Russian money” and “Chinese gamblers”.
The claim was made by Peter Wynne Rees, the recently retired head of planning for the City of London.
Wynne Rees says that Londoners are being priced out of the housing market in the capital by developers too eager to cash-in with wealthy overseas investors, many of whom allow the new property to stand vacant and hope that it will appreciate in London’s overheated property market.
Croydon is subject to a number of high-rise apartment block proposals, including the 53-storey Menta Tower alongside the railway tracks at East Croydon, and the notorious IYLO building, now re-branded “The Island” and being marketed exclusively to buyers in the Far East. And then there is the £1 billion Hammersfield redevelopment in the centre of town.
Wynne Rees believes that too many over-tall skyscrapers, all approved by Mayor Johnson, are ruining the capital’s skyline.
“I think it is homogenised international architecture that is out of scale with its surroundings, damaging the London skyline and giving a very bad impression to people who visit London,” Wynne Rees said.
“And for what purpose? Simply to provide piles of safe deposit boxes for international investors.
“The people that are buying them are buying them for financial security. They’re furnishing them, locking the door… maybe they come and have a vacation for two or three weeks a year, the rest of the time they don’t even rent them out, they’re empty. There will be no people, there will be no community.
“All that’s missing will be the tumbleweed blowing between the buildings.
“We’re getting dirty Russian money being laundered and Chinese gambling,” he said.
Wynne Rees wants the Mayor’s London-wide authority to put a cap on the height of new developments, especially in and around sensitive areas, such as The City of London, where views of St Paul’s Cathedral and the Wren churches are now obscured by the rapidly rising glass towers.
“Only the Mayor, with a strategic plan, can say ‘Well that isn’t appropriate in that location. Let’s set a height limit’,” the former planning chief said.
Wynne Rees says that the Mayor – and by extension London’s other local authories, such as Croydon – should be getting more community benefits and hard cash from developers.
Wynne Rees sees London getting no benefits from the international investment. He highlights how Chinese investors are able to purchase London properties off-plan with a 10 per cent deposit, funding the rest of the price through a property futures market, effectively casino financing that gambles on the property’s price reaching a certain level by a set date.
Wynne Rees wants the Mayor to reverse his developer-friendly policies of the past six years. “If he cools the market and the market then says ‘We can’t build here’, what are we losing? Nothing. It’s the international investment market that will lose. It doesn’t do us any harm,” Wynne Rees told the BBC.
“London house prices cool and people will be able to afford to buy a home. Seems to me a win-win situation.”
London and the south-east has the fastest rate of price increases in the national housing market, with prices rising by 4.2 per cent in April, the fastest rate in 20 years. The National Housing Federation issued a report on Friday that states that homes in the capital are unaffordable to ordinary, hard-working Londoners, with wages lagging behind the cost of renting or buying a home.
Meanwhile, Mayor Johnson continues to act in breach of his own strategic housing plan, which calls for 50 per cent of all new developments to be “affordable homes”.
Last week, the Mayor’s office granted permission to Westfield to include just 12 per cent of affordable homes among the 1,300 being built as part of a £1 billion scheme to extend its shopping centre at Shepherd’s Bush.
In Croydon, the same Tory Party-donor developers have been allowed to include fewer than 90 “affordable homes” among the 600 it proposes to build in its £1 billion south-of-the-river scheme it is developing with Hammerson. Which raises the question of who will the remaining 500-plus apartments be marketed at? Wynne Rees’s Russian money-launderers and Chinese gamblers?
And now Mayor Johnson has made a hospital pass to local councils, such as Croydon, leaving them to deal with investment properties which are left vacant by their owners.
“I want to see the councils using their powers to impose punitive Council Taxes on people who buy a flat, or whatever, and leave it empty,” said Johnson – the man with the power to have influenced the kind of developments that are delivering these investor-targeted properties.
Johnson’s Tory colleagues on Croydon Council have long claimed that insisting that builders include more “affordable” housing in their schemes would scare them off the development. Whether Boris’s threat of “punitive” Council Taxes has the same effect on overseas investors, only time will tell.
“We are providing for absolutely everybody in London,” Johnson claimed, “the difficulty is a short-fall that goes back 30 years. But the rate of acceleration is really starting to take off now in the construction sector in London,” Johnson said, just as he has said repeatedly over the past six years he has been in office.
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- Londoners being priced out of London by social cleansing
Coming to Croydon
- Stitch Pitch quilting workshop, Upper Norwood Library, June 2
- Croydon Tech City “summit”, June 6
- An Improvised Murder, Spread Eagle Theatre, June 7
- Old Town residents’ meeting, June 7
- Crystal Palace Transition Town annual meeting, June 11
- Old Town residents’ meeting, June 11
- Lakes Playground Action Group fun day, June 14
- Croydon Green Fair, North End, June 14
- Elm Tree Cottage garden open day, June 15
- Norwood Society Talk: The Concrete Church, June 19
- Airport House swing dance free event, June 21
- Classic Car Show at Purley Rotary Fields, June 22
- Crystal Palace Overground Festival, June 26-29
- Warnings to the Curious, Spread Eagle Theatre, June 27
- South Norwood Allotments open day, June 28
- Fragile, Spread Eagle Theatre, July 24-26
- CODA’s Midsummer Night’s Dream at Wandle Park, Jul 30-Aug 2
- Elm Tree Cottage garden open day, Aug 10
- Norwood Society Talk: War Memorials, Sep 18
- Norwood Society Talk: From Fire Station to Theatre, Oct 16
- Norwood Society Talk: Lambeth’s Archives, Nov 20
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