London’s Lure

By Patrick Corby

LondonLondon is becoming more attractive to millionaire migrant who are taking advantage of the Tier 1 ‘investor visas’ introduced in 2008.

The specialist visas allow for migrants with a minimum of £1 million or more to invest entry into the UK for themselves and their families on a long-term basis without having to become British citizens. Last year the migrants under this visa increased by three-quarters lead mostly by Russian and Chinese migrants.

From April 2011 wealthy ‘investor migrants’ only had to spend 6 months in Britain to apply for visa – against 9 months without the Tier 1 visa – the wealthy will also get a significant reduction on applying for permanent residency.

Applicants willing to invest £1ml can take permanent residency in the UK after 5 years, those who invest £5ml can take residency in 3 years and those investing £10ml in 2. Before the changes in 2011 anyone entering the UK on a Tier 1 ‘investment visa’ became eligible only after 5 years.

Due to these changes in 2011 the numbers have sharply increased and attracted investment within London.

Russians wanting to migrate and invest in London account for 24% of applicants last year, with Chinese applicants accounting for 23%. This contrasts to only 5% of millionaire investors coming from the US according to the UK Border Agency.

Real estate in London is being driven and bought up by overseas investors with more than 60% of properties priced over £2ml bought by oversea purchasers.

This comes at a time when the UK is squeezing migration out and making it harder to obtain a UK visa. The coalition will try to make net immigration 100,000 by the end of their term.

The UK coalition government has already cut down on international student migration, much to the detriment to British universities who rely heavily on foreign students.

Cuts have also been seen in skilled workers entering the UK. Those without a job offer entering will not be allowed to exceed 1,000 compared to 14,000 in 2010.

Millionaires wanting to enter the ‘safe heaven’ of London and the wider UK can easily meet the requirements of the Tier 1 and therefore opt to enter under its contract instead.

The Bottom Line

  • Changes in ‘investment visas’ are leading to wealthy people entering the UK
  • Restrictions on other types of visas are putting pressure on entering for investment purposes against other options.

 

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