The UK housing market is facing a wave of real estate guidance. According to experts, the UK should put up effective barriers to the illicit funds that appear in the country.
First of all, the UK’s credibility is a premise as investors and those involved in the property realm need to be aware of corruption. Successive governments are taking centre stage on the topic as it causes global feuds and is causing real estate problems.
The UK housing market often seems that they support those who endure corruptive practices, especially to those in the developing world. However, it may also be a problem in relation to practicality, to prevent the proceeds from ending up in Britain. Instead of facing a problem hands on, a lot of the time issues in the corruption world can be ignored – often materialising then into an even bigger problem.
Anti-corruption watchdog Transparency International point out how a lot of money that has been laundered through the UK housing market is contributing to a huge housing crisis. This is particularly related to London, which then leads to the underuse of stock and increase in prices.
The UK government is planning to focus more on overseas owners of property, as they believe that this will help with these issues. Britain’s Department for Business, Energy and Industrial Strategy is looking to find expert advice on measures that includes a breakdown of those owners of overseas firms who have invested in the UK housing market.
Since 2004, law enforcement agencies have identified £180m worth of property in London that has a connection to cases of corruption. 75% of cases investigated in overseas companies are involved in the obscurity of the real owners, so this property news is involving a bigger circle of real estate individuals than anticipated.
Another interesting fact from the Transparency International Company shows that £4.2bn in property in London alone bought by politicians and public officials are suspicious and possibly linked to a high level of corruption. They also found that a lot of developers are relying on investment from those who wish to move their assets out of high corruption risk jurisdictions such as Nigeria and Russia, which poses the risk of dodgy money launderers.
In London, there has been a noticeable fall in electricity usage with a high density of foreign ownership, which highlights thousands of properties are being left alone for a large part of the year. This means that there are a lot of empty neighbourhoods, with little to zero activity. There is certainly foreign investment in UK property that is legitimate but much of what is going on is questionable.
Approximately 3,000 companies have listed their main owner as a company in an offshore tax haven. Will the UK housing market visit justice on the corrupt side of operations in the foreseeable future?
Transparency is so important and vital for not just the UK housing market but for real estate markets all over the world. The need to fight corruption is prominent at this moment in time, and to prevent others from trying to curve the law in any way possible makes this property news even more significant.
Written by Gemma Smith