Protesters shouting “No more homes for millionaires!” outside London City Hall this week want real estate developers to stop pandering to wealthy foreign buyers and start building more housing that locals can afford.

Sparking the protest was a plan by Hong Kong-based Hutchison Whampoa Ltd. to build up to 3,500 new homes not far from London’s Canary Wharf financial district. Mayor Boris Johnson has approved the project.

“These are the kind of homes that local people will never be able to afford,” said Cheryl Coyne, a 63-year-old semiretired schoolteacher. “There are thousands of people in the borough who need homes, and instead they’re building flats for multimillionaires.”

Average London house prices increased 18 percent in the first quarter from a year earlier, the most since 2003, to a record 362,699 pounds ($604,000), the Nationwide Building Society said. Much of that increase stems from wealthy non-British investors seeking assets that would hold their value. Builders use advance sales, often to buyers from Asia, to help finance new projects.

Foreign-born buyers made 69 percent of central London new-home purchases in the two years through June 2013, with 28 percent living outside the U.K., broker Knight Frank LLP said in October.

When the Malaysian owners of the Battersea Power Station project, on the south bank of the River Thames, sold the first 866 homes in just three days in January, more than half went to foreign buyers. Source: Bloomberg

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