London’s mayor says what Melbourne’s won’t

By Leith van Onselen

The mayor of London, Sadiq Khan, has spoken out about foreign investors using homes in London as “gold bricks for investment” following an investigation which found that the UK’s tallest residential skyscraper is now more than 60% foreign-owned and is under-occupied. From The Guardian:

Khan warned that building thousands of new homes a year in London to solve the housing crisis would mean nothing if “they are all bought by investors in the Middle East and Asia for use as second homes or they sit empty”…

“The Guardian’s front page today is an example of the consequences of the last eight years of being obsessed by numbers rather than [building] the right sorts of homes.”

The investigation revealed that homes in The Tower, a 50-storey skyscraper at St George Wharf in Vauxhall, which opened in 2013, had been sold to more than 130 foreign buyers including a Russian billionaire, the former chairman of a defunct Nigerian bank and a Kyrgyz vodka tycoon. None of the 214 flats in the tower are classed as affordable, although it was built as part of a wider development that included 30% low-cost comes.

The shadow housing minister, John Healey, said the building had become “a symbol of the housing crisis” in which new homes are sold abroad as investments and left largely empty while fewer and fewer young people can afford to buy or rent in the city. He said that it “fuels people’s anger and sense of injustice”.

Wow. I wish Australia’s mayors would be so forthcoming. We could certainly do with Mr Khan in Melbourne where high-rise apartments are popping-up all over the place, many of which are being marketed and sold to foreigners and being kept vacant:

ScreenHunter_13139 May. 26 14.00

For an eye-opening examination, check-out the below video from Four Corner’s recent Home Truth’s special report, featuring Prosper Australia president, Catherine Cashmore, taking reporter Ben Knight for a tour through largely vacant apartment blocks in Melbourne’s CBD where, at 8pm on a Tuesday night, the lights are off and nobody’s home:

Former Victorian Premier Jeff Kennett also makes an appearance in the video, slamming the high-rise dog boxes proliferating through Melbourne:

“We are still building units that, to be quite honest, you wouldn’t put your dog in. I mean, some of these one bedroom vertical fridges are appalling. And I couldn’t imagine anything worse”…

“I think we are in for a crunch, there’s no doubt about it”…

Sadly, dissenting voices like Kennett’s are the exception, not the norm.

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Unconventional Economist
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  1. reusachtigeMEMBER

    Sometimes I think that the people on here want a communist world rather than the great free profit driven world we live in!

    • Yes well…Melbourne is the place everyone wants to be! We’ll have 50,000 ‘refugees’ who will occupy those few units. That will leave the other 2 to 3 hundred k’s of immigrants to fight over the few remaining house and land packages. Interest rates headed down… Only a fool would miss out!

      • Now that’s an idea. Tell the foreign owners that they must rent the property at market rates or it will be made available to refugee families at peppercorn rents.

    • One of those communists just got introduced to me this morning on wechat by a student, wanting to know about buying property in Melbourne. There’s nothing wrong with commies mate, they’re more capitalist than we are!

    • The distinction should be left in the last century. The dynamic of a global economy is just ‘have more’, ‘having much less’ and ‘never haves’. Wave whatever flag you want at the beginning, the power dynamic always ends up looking the same in the end. Ok, maybe just keep fascism (of both the left and right) for continuity with this century.

  2. I wonder if Mr Khan realises that selling London homes and apartments is a pillar of the UK economy? Without it there would be a serious drop in living standards and in his and the UK government revenues.
    Of course long term it drives the economy into a ditch – just a question, now, of when you want to go there.

    • Poor bugger probably has to actually use the tube! Doubt anyone at MCC has been to Flagstaff or Parliament in 20 years

  3. The mayors of New York and London have real powers – unlike the mayor of MEL.

    The former London mayor put in a congestion charge. The mayor of NY tried to ban large cola bottles – a huge sugar tax would have been better.

    Mr Khan is a member of the Labour Party – where do they stand on deregulating height limits in some suburbs to improve housing affordability.

  4. “fuels people’s anger and sense of injustice”. Too right
    We have 2 highrise up here with the flammable cladding, which the govt wont disclose, but the identification of which I have well under way. I will advise.
    Should they get torched, that will fuel something.

    • That’s ok when the conflagration comes there’ll be a lovely spot for a surf-club 😉

    • Oh wise and cunning canine – I guess the government is hoist on some petard of its own construction here. Not sure what their motivation is but you put out news of what buildings there are you’ll have the nut jobs out wanting to light it up to see the spectacle – on the other hand you can’t let people keep on buying them.
      Catch cricket pitch!

    • Be very careful, WW. You show anything that threatens them and they will go after you, and I doubt the Law will provide much protection for you.

    • haroldusMEMBER

      interesting point considering the recent bad luck some of our newer entrepreneurs are having with fires in the bottom storeys of apartment buildings.

      what if one of those robbers who tied up the plucky shopkeeper and used the luckily-to-hand accelerant had chosen a building with flammable cladding?

      let’s just hope there are no small franchises in the bottom of any of those buildings….

    • haroldusMEMBER

      funny sorta looks like half of a monster head and shoulders but the neckline would be negative!

  5. Funny to see the bloke who turned Victoria’s net interstate migration from negative to positive, while championing Melbourne at the expense of the rest of the state, decrying the movement of people into Melbourne.
    Nearly as funny as seeing someone who closed mental health beds all over the state become chairman of a body to help people with mental illnesses.

    • Sssshhhhh neoliberalism is an ideology not something to be tested against real outcomes!

    • Robert, that mental health crown belongs to Neville Wran, he kicked the ball off on that around the mid 80s and the other states followed (and I think mostly labor) with the bs fig leaf of getting them “back into the community” to cut costs while not providing the required funding to make that transition successful. Result? Increased homeless with mental health issues as well as the usual drug addiction problems.

  6. this is simply fascist and it reminds of pre WWII Europe – statements like this are just attempts to shift blame and accuse someone else for filed domestic policies

    House prices in places like Mapesbury or Eltham where ordinary people live are not high because foreigners are buying expensive penthouses in City but because of failed financial regulatory policies of UK government.
    Even if foreigners didn’t buy any property in London prices in places like these wouldn’t be much different.

    It’s time to name responsible (governments run by bankers) instead of blaming foreigners, Jews, Muslims, Chinese, heretics, witches, …

    • Correct, government and related agencies have been nobbled and hollowed out for years (with PS management being complicit), to ensure easier access and implementation of policy, by external stakeholders for whom democracy is an inconvenience, and totalitarianism or autocracy keeps the plebs in line, while keeping the non-European infuence at bay….. seems like some class war, with the top people masquerading as concerned socialists (when everyone in Oz is a neo liberal), while filling their boots….

      Simultaneously the right news stories emerge to demonise immigrants, refugees etc., based on ‘interpreted’ survey results e.g. SBS Ipsos recently about support for ‘immigration’ (inflated by statistical definition).

      Was it coincidental that the same story was then retransmitted and spun negatively by Herald Sun, Daily Mail, and of course MB, behind a pay wall?

  7. Somewhat off topic but Reuters is carrying an investigative report headed: How an industry helps Chinese students cheat their way into and through U.S. colleges

    I guess the link between what is happening in our real estate markets and what is happening in US educational institutes is that Chinese money has been allowed to rort and distort the system but now, finally, a few authorities are beginning to raise the alarm. Better late than never.

  8. Belligerent Blue Jay

    I’m not sure if calling him racist makes me racist or the fact that he can say what he says without being called racist is racist. *head explodes*

  9. – Ah, but isn’t the mayor of London only nominally member of a party ? And that’s (more than) a tad different here in “Straya”.

  10. I dunno. This bloke is right about housing but has too many ties to Muslim terrorists for me to want him anywhere near Australia. It’s going to be interesting to see how his term as mayor pans out.

  11. At the same time, London’s property market is not a bubble. I stumbled onto a curious article (, it says that prices won’t fall soon because of continuing growth of the population. To meet growing demand, 40,000–50,000 new homes need to be built each year, even though only 24,000 new lodgings are planned each year between now and 2020. If you are interested, read the whole article, it is written by a professional real estate broker (, so it is the real research but not yellow journalism