Foreign investors account for just over one in 10 of all property sales in the capital, a new report has found - but so-called lights out syndrome is a myth.
The report, commissioned by the Mayor of London from the London School of Economics and the University of York, found overseas investors made up 13.2 per cent of all property transactions between 2014 and 2016.
While foreign buyers purchased a third of all new-build homes in the capital's most exclusive areas, they made up 16 per cent of transactions in inner London, and six per cent of transactions on the edges of the capital.
"Almost no evidence" of empty homes
But the report found "almost no evidence" homes bought by overseas buyers were left empty: "one per cent or less" of the new-build units acquired by foreign investors were left without an occupant.
The report suggested the idea foreign-owned homes are sitting empty may be to do with a lag in filling units once buildings are completed.
"There may be an inaccurate perception that units are empty because the private units in a development will usually complete construction sometime after the affordable homes, giving a mistaken impression of vacancy.
"Further, once large developments are complete, it can take up to two years for occupancy rates to build up, and so homes may be vacant for an initial period before being lived in full time, which may account for perceptions that homes are left empty."
The higher the price, the higher the vacancy rate
However, the report also noted homes with a higher value were more likely to be left empty for at least part of the year.
"Higher [vacancy] rates were found in homes in prime London, more expensive homes (particularly those worth more than £5m), and homes bought by overseas buyers.
"Homes bought by overseas buyers were much more likely to fall into this group compared with ones bought by UK buyers, with higher inferred under-occupancy rates for such homes compared to homes owned by UK buyers. This does not mean that these homes are empty, but rather that they did not exhibit the characteristics that would be expected of homes occupied full time."
However, foreign buyers were far more likely to buy lower-value homes than top-end property. Just over half of sales to foreign buyers were homes worth between £200,000 and £500,000, while 33 per cent were to worth £500,000 and £1m, and 16 per cent were valued at between £1m and £5m. Just one per cent of transactions were worth more than £5m.