0:00:00 > 0:00:03If I'm paying, or we're paying, £2 million for a property,
0:00:03 > 0:00:07two-bed here, and it costs a quarter or less than that,
0:00:07 > 0:00:08it's considered affordable.
0:00:08 > 0:00:11London, it's a global city, it's got a great government.
0:00:11 > 0:00:13It's considered a safe haven.
0:00:13 > 0:00:17And there's no shortage of Brits spreading the word.
0:00:17 > 0:00:20Property values are rising throughout the UK.
0:00:20 > 0:00:25In particular they've been rising in London and the South East.
0:00:25 > 0:00:26Cheap.
0:00:26 > 0:00:29Very cheap. No, I'm serious!
0:00:29 > 0:00:32I actually spent a week over there and I found something.
0:00:32 > 0:00:34What would your message to all those Londoners that
0:00:34 > 0:00:37- you're beating in the purchase? - Don't push us out.
0:00:37 > 0:00:39We're coming in with the money
0:00:39 > 0:00:42so I think it's good for the economy, I guess.
0:00:42 > 0:00:44Do you understand why Londoners are getting angry,
0:00:44 > 0:00:47- with you guys buying all this property?- I would be.
0:00:47 > 0:00:49CAR HORN BEEPS
0:00:52 > 0:00:55Take a look at this tiny micro apartment.
0:00:55 > 0:00:59It's all £330,000 will buy you in Hong Kong.
0:00:59 > 0:01:02So, just looking at this, this is why...
0:01:03 > 0:01:08- ..London and the UK are so appealing to Chinese investors.- Exactly.
0:01:08 > 0:01:11You can live here and you do everything on your own.
0:01:11 > 0:01:16- But you'd want to be on your own in here.- Yeah.
0:01:16 > 0:01:19For the same money, a Chinese investor can get a decent
0:01:19 > 0:01:23two/three-bed buy to let in London, earning double the rent
0:01:23 > 0:01:28but that's just the type of home Londoners are desperate to buy.
0:01:28 > 0:01:32Centaline is one of Hong Kong's biggest estate agents.
0:01:32 > 0:01:35This worker is closing a sale on far-off Croydon.
0:01:35 > 0:01:38An Englishman might think his home is his castle,
0:01:38 > 0:01:41but the boss here considers it a toy.
0:01:41 > 0:01:44Some people are buying property as a toy.
0:01:44 > 0:01:48Actually, maybe in UK there is some very special property,
0:01:48 > 0:01:51- they will like it and they buy it. - As a toy?- As a toy.
0:01:51 > 0:01:53It's a touchy subject.
0:01:53 > 0:01:56These London agents wouldn't be interviewed about the Hackney
0:01:56 > 0:01:58flats they're selling here.
0:01:58 > 0:02:01OK, so essentially you're saying you can't now do the interview...
0:02:01 > 0:02:04'One by one, British estate agents are going shy.'
0:02:04 > 0:02:07Londoners will see Chinese people buying their homes
0:02:07 > 0:02:09and you don't want them to know that.
0:02:09 > 0:02:14But back at the expo, Savills' Head of Asia braved the camera to explain
0:02:14 > 0:02:19why on earth New London homes are being offered to Asia first.
0:02:19 > 0:02:21I have to say that we normally do bring out
0:02:21 > 0:02:23an exhibit in Asia first
0:02:23 > 0:02:26because culturally people are accepting to buy two or three years
0:02:26 > 0:02:29in advance, and British people can buy if they want,
0:02:29 > 0:02:31they just choose not to most of the time.
0:02:31 > 0:02:34Something like Battersea, one of the biggest elements of that being
0:02:34 > 0:02:36a success is that it was sold off plan.
0:02:36 > 0:02:40How many times did it change hands in the course of the last 30 years?
0:02:40 > 0:02:41It's sat there, derelict,
0:02:41 > 0:02:44and actually it is going to be a huge pinnacle point of London
0:02:44 > 0:02:48and really set itself on the map over the course of the next ten years.
0:02:48 > 0:02:52This is a brochure for Capital Towers, E15 Stratford.
0:02:52 > 0:02:556,000 miles away. It is incredibly glossy.
0:02:55 > 0:02:58There are aerial views, room interiors,
0:02:58 > 0:03:00they've sold most of the flats.
0:03:00 > 0:03:04But in reality, this building does not yet exist.
0:03:08 > 0:03:12This is it, a building site next to three tiers of traffic
0:03:12 > 0:03:14and the rather bleak Bow Flyover.
0:03:14 > 0:03:18At 326,000 for a one-bed,
0:03:18 > 0:03:21it's no option for our first-time buyers.
0:03:21 > 0:03:24The brochure claims it's 20 minutes from Buckingham Palace.
0:03:24 > 0:03:27If you do get a royal invite, be warned.
0:03:27 > 0:03:31Transport for London say it's 54 minutes door-to-door.
0:03:31 > 0:03:34But back at his Hong Kong office,
0:03:34 > 0:03:37Neil Jensen has already sold most of them.
0:03:37 > 0:03:39It's been one of the fastest selling this year, I'd say.
0:03:39 > 0:03:41In one weekend it was over 50.
0:03:41 > 0:03:44And then down in Singapore, there was about another 30 down there.
0:03:44 > 0:03:50- So, it's been... busy.- There's not many left at all now, is there?- No.
0:03:50 > 0:03:54Computer-generated images as to what it's going to look like really
0:03:54 > 0:03:56do help us. People can go onto Google Earth now.
0:03:56 > 0:03:59You can walk down the street on your computer screen.
0:03:59 > 0:04:00So people can see it.
0:04:00 > 0:04:04We have images of how that would look. You can see the London Eye.
0:04:04 > 0:04:05And that's how they buy in Asia.
0:04:05 > 0:04:09So if they buy in Asia, then they can do that for London.
0:04:11 > 0:04:15But there's growing anger over Asia being offered the pick of the crop.
0:04:15 > 0:04:19There's not many left now. Most of them seem to have gone.
0:04:19 > 0:04:21What went last night?
0:04:21 > 0:04:232401 went last night.
0:04:23 > 0:04:28Some developers are now offering to UK buyers first, or at the same time
0:04:28 > 0:04:32as Asia, but if Chinese investors here stick to their habits,
0:04:32 > 0:04:36this experienced Hong Kong estate agent has a warning for London.
0:04:37 > 0:04:40They view the property market almost like the equities market.
0:04:40 > 0:04:44They look at the... they're in and they're out, they speculate heavily.
0:04:44 > 0:04:46People like to normally go in, buy a property
0:04:46 > 0:04:49and sell 12 months later, it's a very short-term view.
0:04:49 > 0:04:52It's viewed as a commodity. They don't care where it is.
0:04:52 > 0:04:56- They're just after capital growth. - London versus rest of UK.
0:04:56 > 0:04:59People often will buy property and never put a tenant in there.
0:04:59 > 0:05:01To have a tenant in a property in Hong Kong
0:05:01 > 0:05:04if you want to sell it is a negative.
0:05:04 > 0:05:07You look up at high-rise buildings here at night,
0:05:07 > 0:05:08and all the lights are off.
0:05:08 > 0:05:11And that's because a third of the building is probably
0:05:11 > 0:05:15owned by mainland Chinese and they just keep their shopping bags there
0:05:15 > 0:05:16when they visit once a quarter.
0:05:16 > 0:05:19That property over there, that's nice...
0:05:19 > 0:05:23Back in London, with so many struggling to buy,
0:05:23 > 0:05:27investment homes standing empty have become very embarrassing.
0:05:27 > 0:05:30I have responsibility for housing and development in the council.
0:05:30 > 0:05:34This Islington councillor claims he has evidence it is happening
0:05:34 > 0:05:37here at the luxury Bezier Building on Old Street,
0:05:37 > 0:05:40where flats go for over a million.
0:05:40 > 0:05:41I think the problem that I found
0:05:41 > 0:05:44when I started digging in some of the electoral roll data
0:05:44 > 0:05:48and the council tax data is almost half of these 127 flats
0:05:48 > 0:05:53are registered as empty, or have no response to the electoral roll.
0:05:53 > 0:05:57And the other ones have a strange combination of sometimes students
0:05:57 > 0:06:00registered as being exempt, sometimes companies,
0:06:00 > 0:06:03and actually only about a third of these flats are what you might call
0:06:03 > 0:06:06a typical use where you've got an individual registered to vote
0:06:06 > 0:06:10and registered to pay council tax. I think a lot of these flats are being used
0:06:10 > 0:06:13as places for wealthy people, particularly people from overseas
0:06:13 > 0:06:16to stash their cash, sit back whilst they see their asset go up in value.
0:06:16 > 0:06:17I think it's really galling,
0:06:17 > 0:06:22it's really insulting to Londoners who need somewhere to live and work.
0:06:22 > 0:06:24These are the views.
0:06:24 > 0:06:26'Inside these very plush apartments,
0:06:26 > 0:06:30'Bezier say they know of only four empty flats.'
0:06:30 > 0:06:34Can you stop people buying one of these and then leaving it empty?
0:06:34 > 0:06:36No, we can't.
0:06:36 > 0:06:40But the fact of the matter is, that is not what is happening here.
0:06:40 > 0:06:41The facts are here to be seen
0:06:41 > 0:06:44when you physically spend the time in the development
0:06:44 > 0:06:48and you see who lives here and who is here on a day-to-day basis.
0:06:48 > 0:06:52You don't go by the figures that he has gathered from Islington Council?
0:06:52 > 0:06:54Most certainly not.
0:06:54 > 0:06:58Islington Council is now considering a plan to fine owners thousands
0:06:58 > 0:07:00of pounds for sitting on empty homes.
0:07:00 > 0:07:04Politics is now targeting the foreign investors.
0:07:04 > 0:07:07We will end the nonsense of people putting a chair in a home
0:07:07 > 0:07:09and saying it's no longer empty.
0:07:09 > 0:07:12We've got to... We've got a massive housing crisis here in London.
0:07:12 > 0:07:15Labour is talking about this and showing how we will act.
0:07:17 > 0:07:20- Oh!- It's all right. You're perfectly safe with me, don't worry.
0:07:20 > 0:07:24London's Conservative mayor has worked hard for Chinese investment
0:07:24 > 0:07:25to the capital.
0:07:25 > 0:07:30But earlier this year, he too gave warning to foreign speculators.
0:07:30 > 0:07:33We want to see these new-build homes,
0:07:33 > 0:07:35or these homes that they buy, lived in.
0:07:37 > 0:07:41Because my view is that London homes aren't some kind of new global
0:07:41 > 0:07:43asset class,
0:07:43 > 0:07:47they aren't just blocks of bullion.
0:07:47 > 0:07:48Lovely to meet you both.
0:07:48 > 0:07:51If you've got any questions, I'll give you my card.
0:07:51 > 0:07:54At Eagle Old Street, Michael's client might buy.
0:07:54 > 0:07:58I think 90% or 80% that he will choose one. Yes.
0:07:58 > 0:08:00As we rise above the showroom,
0:08:00 > 0:08:04the developer warns British politicians and the public to be
0:08:04 > 0:08:08very careful what they wish for when sneering at foreign investors.
0:08:08 > 0:08:11Your traditional London purchaser, in Mount Anvil's experience,
0:08:11 > 0:08:13did not buy off plan.
0:08:13 > 0:08:17A building like this, which was idle for about three years,
0:08:17 > 0:08:1827 storeys,
0:08:18 > 0:08:21ugly concrete frame, without those forward sales
0:08:21 > 0:08:25this building would not have been restarted.
0:08:25 > 0:08:29So Mount Anvil has created about 1,000 jobs out of this building.
0:08:29 > 0:08:32And a lot of our purchasers here are actually London people as well
0:08:32 > 0:08:34so we think it's a win-win.
0:08:34 > 0:08:37And there's about 70 affordable homes here as well.
0:08:37 > 0:08:41And that wouldn't have happened if we didn't have the international buyers.
0:08:44 > 0:08:47That's...two houses, £150, please.
0:08:47 > 0:08:51It's a cruel twist that many investment apartments will be
0:08:51 > 0:08:54rented out to the Londoners now priced out of buying.
0:08:54 > 0:08:57So, do you want to go that way and I'll go that way
0:08:57 > 0:08:58and meet in the middle?
0:08:58 > 0:09:00Jess has taken to leafleting homes,
0:09:00 > 0:09:05desperate to escape those mass viewings and sealed bids.
0:09:05 > 0:09:08"Please excuse this rather direct approach but there is very little
0:09:08 > 0:09:12"on the market and your house looks like one we would be interested in."
0:09:12 > 0:09:15I'm going to be 30 in six months' time.
0:09:15 > 0:09:18I don't want to be paying off someone else's mortgage,
0:09:18 > 0:09:19I want to pay my own mortgage.
0:09:19 > 0:09:23I'm now looking in Forest Gate,
0:09:23 > 0:09:25which is
0:09:25 > 0:09:28an area that is, for want of a better term, up and coming.
0:09:28 > 0:09:32- Is there much crime round here?- Huh? - Is there much crime round here?- No.
0:09:32 > 0:09:36You've got to imagine it without all the stuff in it, haven't you?
0:09:36 > 0:09:40So this is the one that I'm going to see on Saturday.
0:09:40 > 0:09:43And it looks quite nice actually, if you have a look.
0:09:43 > 0:09:45It does, but you've got five minutes,
0:09:45 > 0:09:47you got a five-minute slot to see it.
0:09:47 > 0:09:49"Text us by five o'clock."
0:09:49 > 0:09:51- Well...- The pressure is just unbelievable on you.
0:09:51 > 0:09:54They're just out of my price range, really.
0:09:54 > 0:09:57The truth, I'm just going to help her financially.
0:09:57 > 0:10:01I've got friends who say, "Oh, we stood on our own two feet,
0:10:01 > 0:10:03"we got on the housing ladder, we got going
0:10:03 > 0:10:05"and no-one give us any help."
0:10:05 > 0:10:08They don't think that's a realistic approach or a fair approach
0:10:08 > 0:10:12to adopt now. I think actually we've just been really lucky.
0:10:12 > 0:10:16It is incredible that my daughter is now priced out of Walthamstow.
0:10:19 > 0:10:23Priced out of boroughs they would have once had nightmares about living in
0:10:23 > 0:10:28and pushed to new frontiers in the wild east of London,
0:10:28 > 0:10:32gambling on the new railroad, Crossrail, halving journey times
0:10:32 > 0:10:34into town in 2018.
0:10:34 > 0:10:38I really think once Crossrail comes to Forest Gate people are going
0:10:38 > 0:10:41to start to realise the value of Crossrail, that you can get
0:10:41 > 0:10:45into Liverpool Street really quickly, get to Paddington really quickly,
0:10:45 > 0:10:49and it's going to make it more desirable for overseas investors as well.
0:10:50 > 0:10:54But if Jess thinks the overseas competition hasn't noticed
0:10:54 > 0:10:58Crossrail, I've some very bad news from Hong Kong.
0:11:02 > 0:11:04There are plenty of wise old Chinese proverbs
0:11:04 > 0:11:07but perhaps one for the 21st century, certainly for
0:11:07 > 0:11:11Hong Kongers, is "He who buys near a new subway station
0:11:11 > 0:11:13"makes lots of money."
0:11:15 > 0:11:19Until 1979, Hong Kong had no subway,
0:11:19 > 0:11:21now it has 152 stations.
0:11:21 > 0:11:26And every new suburb it reaches sees property values soar,
0:11:26 > 0:11:28so the Chinese get Crossrail.
0:11:28 > 0:11:31MAN ON RADIO: The Queen stayed at the controls for the short journey
0:11:31 > 0:11:33between Green Park and Oxford Circus.
0:11:33 > 0:11:36Londoners haven't seen a completely new Tube line
0:11:36 > 0:11:41since the opening of the Victoria, way back in 1969.
0:11:41 > 0:11:44Crossrail is the single biggest driver.
0:11:44 > 0:11:46In Asia they just see opportunity.
0:11:46 > 0:11:49And they know that there's an end product there
0:11:49 > 0:11:52and that is definitely driving the market, no doubt about it.
0:11:52 > 0:11:56So they're looking at maps of Crossrail and buying along the line?
0:11:56 > 0:11:57Absolutely.
0:11:57 > 0:12:00London's rapid new East-West connection,
0:12:00 > 0:12:04paid for by London business and British taxpayers,
0:12:04 > 0:12:09and now shaping where Mr Liang invests £1 million.
0:12:09 > 0:12:13I'm looking for a house around a million.
0:12:13 > 0:12:17- Around a million?- Yes. - And you know there is a Crossrail.
0:12:17 > 0:12:20Yes, I know the Crossrail is going to complete in 2018.
0:12:20 > 0:12:25I believe after Crossrail finishes, the capital income will be
0:12:25 > 0:12:30increased roughly around 10 to 15% every year.
0:12:30 > 0:12:32They're not living with the roadworks,
0:12:32 > 0:12:35they're not living with the signs and all the rest of it,
0:12:35 > 0:12:38they just think, "Wow, in five years that's only going to be
0:12:38 > 0:12:41"15 minutes away and at the moment it's nearly an hour."
0:12:41 > 0:12:45There's always been foreign investment in London, always.
0:12:45 > 0:12:49But you can't be a world city and not allow foreign buyers.
0:12:51 > 0:12:54But it's not just gleaming towers for sale here.
0:12:54 > 0:12:59How about a slice of the protected green belt surrounding London?
0:12:59 > 0:13:01Chinese investors are buying it up,
0:13:01 > 0:13:05gambling we'll have to build on it eventually.
0:13:05 > 0:13:09It's great because the profit at the end is about 600%.
0:13:09 > 0:13:13So essentially you are selling land at the moment that hasn't got
0:13:13 > 0:13:16planning permission but the idea is, buy now and at some point
0:13:16 > 0:13:19they may get it, because London is getting bigger and bigger?
0:13:19 > 0:13:20Exactly.
0:13:20 > 0:13:23Obviously with all that pressure on the government,
0:13:23 > 0:13:26- permissions are becoming easier. - It just seems crazy.
0:13:26 > 0:13:28It's a great long-term investment. It's a great one.
0:13:28 > 0:13:30I don't care where you're from, if you've got money
0:13:30 > 0:13:33and you'd like to invest, this makes all the sense in the world.
0:13:33 > 0:13:36I'm beginning to wonder, is this a London mania?
0:13:36 > 0:13:40One man here called in lawyers after buying a property
0:13:40 > 0:13:43described as a 40 minute walk to central London.
0:13:43 > 0:13:45It was in Lincolnshire.
0:13:45 > 0:13:48Some people are going to get burned, aren't they?
0:13:48 > 0:13:51If you're buying in a sort of secondary location where the
0:13:51 > 0:13:56large majority of owners are foreign, who are in there speculating,
0:13:56 > 0:14:00suddenly if the market drops 5% and everyone is looking to sell
0:14:00 > 0:14:03at the same time, it just pushes the price down further.
0:14:03 > 0:14:07- So there could be tears?- I'd say there'd be a few tears, yeah.
0:14:07 > 0:14:10Nowhere is this more apparent than along the River Thames.
0:14:10 > 0:14:14Areas once considered pretty rough are now seeing luxury
0:14:14 > 0:14:18developments, £900,000 and up per apartment.
0:14:18 > 0:14:20It seems absurd to local residents.
0:14:20 > 0:14:24And some experts are also getting worried.
0:14:24 > 0:14:26In the 15 years we've been running Estates Gazette, London
0:14:26 > 0:14:30Residential Research, we've never seen anything like this.
0:14:30 > 0:14:34Over half the units in the pipeline are going up in this necklace
0:14:34 > 0:14:37of high-end, high-rise towers to the south of the Thames
0:14:37 > 0:14:40and you ask a Londoner and they will tell you,
0:14:40 > 0:14:43these properties aren't really in places you would call prime.
0:14:43 > 0:14:44Never mind super prime.
0:14:44 > 0:14:47And yet they are attracting Mayfair style price tags.
0:14:47 > 0:14:49And you've got to say,
0:14:49 > 0:14:52what happens off the back of those Mayfair style price tags?
0:14:52 > 0:14:56Well, we reckon this has all the hallmarks of a bubble.
0:14:56 > 0:14:59And the researchers tell me this bubble has maybe two-and-a-half,
0:14:59 > 0:15:01three years to run in it.
0:15:01 > 0:15:04The people who possibly could get hurt in this are those looking
0:15:04 > 0:15:07to use debt to buy homes to live in that have been pushed further
0:15:07 > 0:15:09and further out into London.
0:15:09 > 0:15:12- The Londoners, basically? - The Londoners.
0:15:13 > 0:15:17Snared in a bubble or miss out on the 11% rise
0:15:17 > 0:15:22predicted for London property this year - a frightening game
0:15:22 > 0:15:26and our players are intent on taking that chance.
0:15:26 > 0:15:29But with the world also rolling the dice on their home,
0:15:29 > 0:15:31it isn't going to be easy.
0:15:38 > 0:15:40Louise and Nick have a sealed bid in
0:15:40 > 0:15:42on their new frontier, Plaistow.
0:15:43 > 0:15:47Jess and Dad had an offer accepted and await bank approval.
0:15:49 > 0:15:53After discovering he could only buy a boat for under £100,000,
0:15:53 > 0:15:55Tom now plans to buy with a friend.
0:15:55 > 0:15:58It's tough for the buyers. We do feel sorry for them.
0:15:59 > 0:16:04And Leanne, winner of that crazy sealed bid, was dumped.
0:16:04 > 0:16:09The owner put it back on the market for yet another ten grand more.
0:16:09 > 0:16:10Why?
0:16:10 > 0:16:12Because for now, he can.