Ross Clark

Globophobia | 1 May 2004

A weekly survey of world restrictions on freedom and free trade

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Ten new members join the European Union on Saturday and thousands of economic migrants are queueing up at the borders, raring to go. I refer, of course, to Western European property investors hoping to make a killing on property markets in the East. While we have heard a lot of grim warnings in the press about Eastern Europeans descending on Dover by the busload to take our jobs, steal our women and eat our children, buy-to-let investors have received nothing but encouragement: last weekend’s property sections were brimming with suggestions as to where to invest, what to buy and how much rent it is possible to screw out of your Estonian tenants.

Such is the hypocrisy we show towards free trade. When it’s about us travelling abroad without the need for a visa, buying property and coming home with an MPV-load of cheap wine and fags, we’re all for it. When it’s about foreigners coming here to look for work in our restaurants and on our building sites, on the other hand, suddenly it’s not such a good idea after all. Western European nations have been quick to erect barriers to keep out Eastern European workers for seven years to come. Yet as part of their conditions of entry the EU’s new member states have been ordered to open their property markets to foreign investors from the outset. Poland and the Baltic states have already done so; the Czech Republic will have to relax rules against foreigners buying property by 31 January next year.

The attentions of buy-to-let investors aren’t going to make life any easier for young Eastern Europeans wanting to buy their own homes: house prices in the Lithuanian capital Vilnius, for example, have risen by 50 per cent over the past year in anticipation of EU membership. Eastern Europeans face seven years at the hands of Western European rentiers before they will be allowed to reap their own benefit from the single market.