'Stop using London homes as piggy banks for the world's rich'

 
28 November 2013

Labour promised to curb foreign ownership of much-needed London homes today as it emerged that flats in a luxury apartment block are being advertised to rich overseas investors two years before it is even completed.

The “Canaletto” building in Islington is currently just a building site. But glossy advertisements offering apartments as an  investment have already been circulated to the world’s super-wealthy.

On a visit to the site, shadow housing spokesman Emma Reynolds said too many homes were becoming money-making schemes for rich foreigners who have no intention of living in London.

“Ideally we would like to stop altogether people using London homes as piggy banks for the world’s wealthy,” she said.

“There is a housing crisis in London yet there are about 50,000 empty homes. Housing is central to the cost of living crisis, especially in London, whether people are paying rents in the private sector or looking to get on the housing ladder.”

Labour’s plans includes:

Using planning permissions to require that homes are marketed to Londoners first, rather than sold off-plan to investors.

Doubling council tax for homes left empty, costing owners a penalty of £1,300 a year on average.

Axing a loophole that lets overseas owners cut their tax bill by claiming it is a “second home” rather than an empty home. At present, they can cheat by furnishing it with just a table and chair.

The 24-story Canaletto is described in marketing as “a masterpiece ... with truly exceptional and rare levels of both service and amenities.”  Estate agents Knight Frank have a named contact on their Hong Kong website for people buying to invest.

A spokesman for Canaletto said: “Part of the Canaletto development includes two affordable housing properties, managed by Family Mosaic, encompassing 100 units, many of which are larger homes designed for families. Of the 100 units, 50 are social housing properties and 50 are shared ownership properties - a volume significantly in excess of the minimum requirement set by the local authority. These properties have been finished already - two years ahead of the completion of Canaletto.

"Of the 190 units in the Canaletto development, less than 20 per cent have been marketed to overseas owners and we anticipate that the remainder will be sold to Londoners or others living in the UK.”

A recent study found that only a third of apartments in the nearby Bezier building had occupants who were registered to vote and pay council tax.

The most infamous example of absentee owners is the £1.2 billion One Hyde Park development, which was dubbed “London’s Mary Celeste” after it emerged only three of its 85 apartments were used as full-time homes.

Labour argues that a major house-building programme would tackle the root of the housing crisis.

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