I suspect that this is really a form of xenophobia, used, among other things, to sensationalise newspaper articles.
It's called "buy-to-leave" and no it's not xenophobia, it's a symptom of a housing bubble very much centred on London.
- The central London population is very transient. Many stay only for a few weeks, months or at most a year or two. Why bother registering?
- Many central Londoners, especially the young and newly arrived, move about quite a lot before they settle in one place for longer. They would not bother with registration.
- Many, probably the majority of central Londoners are foreign and don't bother with the electoral register because they can't vote in the general elections anyway, and may not know that the can vote for the major (or may not care).
- There's a lot of legally questionable subletting going on (think AirBnB), where the subletter and / or sublettee might not necessarily want to be on an official register.
- Some owners may simply fail to find a tenant, for example because they pitch rent too high.
As a piece of anecdotal evidence, I offer myself: I only got on the electoral register about 10 years after I moved to London.
Would they be? What's a realistic amount of rent to charge on a GBP 5,000,000 flat? How many people can afford that and are looking to rent?
(Also I think many appreciate having their London flat available for the few days a year they're in town)
If you want to park your money in property, the worst thing you could do is hand control of that money to a group of people with legal right to keep if for certain periods.
Property prices and rental income in London are extremely high. I cannot see how anyone but the extremely wealthy could afford letting London property stay empty as an investment. And there are not enough extremely wealthy around to account for the large number of empty properties that London is allegedly seeing.
There was an article posted on HN a few months back (which I can't locate right now) which explained this problem.
Having tenants requires work, adds cost, and might just not be worth your time.
You might just want a house for a weekend, and not want plebs messing your shit up.
And it probably has some degree of truth, You can stand outside 'new' buildings for a week and never see lights on in some windows.
I'd guess the price of these is around £350k - £1.5m (for a reasonable 1 - 3 bed flat in a new build), which is well within the reach of well off foreign middle class investors.
Incidentally, I just had lunch with an architect and a guy who runs a building company, both London-based. I asked them about this. They both agreed that no sane investor would leave flats bought as investments empty. Investment means basically having tenants. The agreed that there is a media-driven moral panic about this. The architect said he had one client who had a 12 bed-room house in central London that was empty for most of the year ... that customer was a member of Kuwait royal family.
I'm not saying such speculative investment doesn't exist, I just doubt it is as ubiquitous a phenomenon as claimed.