After final yr’s basic election, with the assistance of prime drawer consultants, I wrote about why no work had began on constructing the 300,000 houses throughout Better London for which planning consents had been given.
Shut to 1 yr later, development and improvement are nonetheless deeper within the doldrums and the identical passage of time has seen the federal government set the capital the goal of getting new houses constructed at a price of 88,000 a yr. It types a big a part of it five-year goal of 1.5 million houses nationally and is a big process. If anybody within the within the capital thinks it may be achieved, I’ve but to come across them.
Subsequent week, the federal government will announce its long-awaited spending evaluation, typically referred to as the complete spending evaluation, as a result of it units the budgets for all departments and does so for a number of years to return. It is going to cowl each the funding of public companies and funding in every part from vitality, to analysis, to defence, to move and, sure, to housing.
It subsequently appears second to carry collectively in a single place ten of the largest explanation why nothing like sufficient houses have been in-built London these days, and contemplate what should be accomplished about it. Different causes might be added. A few of them overlap. However I believe, taken collectively, they offer a reasonably good thought of why the town isn’t doing practically in addition to it must – and a few clues about how which may change.
One: Not Sufficient Authorities Cash
This may appear apparent. It may also appear daft. Apparent, as a result of the availability of “reasonably priced” houses of each sort, from social hire to shared possession, relies upon enormously on the Mayor getting cash from the federal government’s Reasonably priced Properties Programme (AHP) to allocate to housing associations and councils. Daft, as a result of the present programme has fallen far off the tempo. However there are causes for that failure that aren’t confined to London. And none of them imply more cash wouldn’t assist.
Chatting with On London in July, former Southwark Council chief and London Councils chair Peter John stated a few of these many dormant schemes might be woke up with extra public funding assist. The opposite week, Nationwide Housing Federation chief government Kate Henderson stated: “To construct the social and reasonably priced houses the nation wants and assist ship the federal government’s formidable targets it’s vital the upcoming Spending Assessment features a vital increase in funding for social rented houses.” Eighteen months in the past, assume tank Centre for London referred to as for a giant increase to AHP to fund 90,000 social hire houses a yr in England, of which 30,000 ought to be for the capital, the place want is so acute.
It’s clear that Chancellor Reeves and Deputy Prime Minister Rayner, who can also be the housing secretary, have been arguing about how a lot the latter goes to get from the previous. Please, Rachel. Cough up.
Two: Not Sufficient New Transport Infrastructure
Final Tuesday, I used to be proven spherical Thamesmead, the place housing affiliation Peabody is engaged in a big regeneration and improve of the property constructed there by the Better London Council within the late Nineteen Sixties. Additionally it is poised to construct much more Thamesmead houses if and when Transport for London will get the billion or so it wants to increase the Docklands Mild Railway south of the river to a brand new station within the north of the realm.
The extension would start on the opposite facet of the water, the place a Beckton Riverside station can be constructed too. TfL says the scheme as an entire would facilitate as many as 30,000 new houses being constructed alongside the route. The hyperlink between transport and housing is, very merely, that there’s no level constructing houses until folks can journey to and from them simply. In spite of everything, if they’ll’t, they gained’t need to purchase or hire them, which undermines the purpose of constructing them, which implies they gained’t get constructed.
Fingers are anxiously crossed at TfL for a long-term funding settlement that additionally offers hope for an extension to the Bakerloo line to ultimately be constructed, resulting in extra housing from Elephant and Citadel to Lewisham. Will London be that fortunate, or will the town fall sufferer to the baleful politics of “north-south divide” and miss out, with different cities being favoured?
Three: Not Sufficient Development Staff
Final yr, the London Properties Coalition, a partnership of housing associations, constructing contractors and others, labored out that over the approaching years they might be 2,600 in need of the employees they should take care of present properties, retrofit them to satisfy new security and environmental requirements, and construct new houses.
Its Expertise for the Future report discovered that workforce to be ageing, shrinking and more and more missing the data it wants. That’s been an issue since earlier than Brexit, however leaving the EU and the legacy of Covid-19 have made it worse. It’s a nationwide downside, too: final month, the Federation of Grasp Builders referred to as for pressing motion.
The federal government-funded London Native Expertise Enchancment Plan recognized development as a key sector for motion. The London Progress Plan, put collectively by the Mayor and London Councils, lays nice emphasis on coaching up extra Londoners. However there’s an amazing deal to be accomplished and the federal government’s proposed immigration curbs aren’t going to assist.
4: Supplies Have Turn out to be Extra Costly
The worth of constructing supplies reminiscent of metal, timber and concrete rose by 23 per cent throughout 2021, hampering new homebuilding (and each different sort of constructing). Extra just lately, there was some stabilisation, however a development trade nationwide forecast revealed in March stated constructing prices will improve by 17 per cent over the following 5 years and this yr will likely be one other tough one. And I haven’t even talked about vitality prices.
5: New Constructing Security Laws
The Constructing Security Act 2022 was handed within the wake of the Grenfell Tower fireplace, with a particular give attention to high-rise buildings. The issue is that the approval course of, run by the Constructing Security Regulator, that housing schemes should go earlier than work can start is shifting very, very slowly within the capital.
Development Inquirer just lately reported that begins on new houses in London had fallen by 38 per cent within the first quarter of 2025 in contrast with the identical interval the earlier yr due to delays on the stringent Gateway 2 stage. For instance, an accredited part of the Woodberry Down property regeneration in Hackney is becalmed due to it.
Earlier than that, following Sir Sadiq Khan saying in February 2023 {that a} authorities proposal to require two staircases to be included in all buildings 30 metres or extra tall would apply in London right away, many tasks went again to the drafting board.
Six: The Inexperienced Belt
Making it simpler to construct on Inexperienced Belt land inside Better London that isn’t very inexperienced – “gray belt”, as Sir Keir Starmer and others name it – gained’t magically loosen London’s constipated housing provide, however it ought to make a useful distinction.
For too lengthy, politicians have gotten away with inflammatory claims that any slackening of protections that have been put in place a long time in the past will end in England’s verdant countryside, so integral to the nation’s identification in some minds, being “concreted over”. Arguments raging in Enfield in the mean time make the purpose. They have to be defeated.
Seven: Small Websites Aren’t Getting Constructed Out
Architect Russell Curtis, who has made a number of vital interventions within the housing coverage debate, has for years been calling for extra small websites throughout the capital to have houses constructed on them. Writing for On London in 2020, he described as “a betrayal” the elimination from Sadiq Khan’s proposed new London Plan by the federal government’s planning inspector of insurance policies to encourage improvement on small websites, particularly within the suburbs. Planning guidelines and the funds of smaller firms who may develop smaller websites could cause issues – issues that have to be solved.
Eight: Worth Stagnation
“The capital nonetheless has by far and away the costliest houses within the nation,” wrote residential property skilled Neal Hudson for the Monetary Occasions in December. Nonetheless, he continued: “This masks one thing you hardly ever examine – London’s property market has been stagnating for years.” Over the previous decade, he went on, London home costs have risen by 13 per cent, however in “actual phrases” – that’s, adjusting for inflation throughout that interval – they’ve fallen by 16 per cent.
That’s not a lot consolation for would-be first time patrons when the typical London home worth is about £680,000 and the typical deposit wanted, near £150,000. However the issue is that housing provide in London – together with of all types of sub-market priced houses – relies upon, whether or not we prefer it or not, on a rising market and personal monetary funding. If people or establishments that fund residential developments don’t assume they’ll get adequate returns on investing in London, they gained’t make these investments. Such reticence goes a protracted option to explaining why these 300,000 houses that might be constructed aren’t being constructed.
End result? Fewer choices for present householders who may need to upsize or downsize domestically, that means fewer houses available on the market usually; extra curiosity in purpose-built pupil lodging and build-to-rent as an alternative; fewer “reasonably priced” houses generated by Part 106 agreements with boroughs, which is how quite a lot of these in London come about. A big and someday loud physique of opinion can’t or gained’t consider it. However the way in which issues are, with all their limitations, if you would like extra “reasonably priced” houses you want extra so-called “luxurious” houses as nicely.
9: Too A lot “Planning Acquire” Required
Following on from cause eight, comes an unpopular query: is the Mayor insisting on non-public builders offering an excessive amount of when it comes to “reasonably priced” houses and different types of “planning achieve“, reminiscent of public realm and well being services, as a situation of giving their schemes a inexperienced mild? Your reply will rely on what you imply by “an excessive amount of”. However what counts ultimately is what builders – and, crucially, these placing cash into their schemes – assume “an excessive amount of” is.
Quickly after he was first elected in 2016 the Mayor launched supplementary planning steering that gave a quick observe path to mayoral approval for giant planning functions on privately-owned land whose housing included 35 per cent “genuinely reasonably priced” houses and a a lot harder time for those who didn’t.
This was broadly accepted as affordable on the time, largely as a result of it was clear and constant and had the objective of holding down the value at which land was offered – a key issue within the total value of property improvement. Nonetheless, circumstances have modified, together with for housing associations, which, as Savills has defined, are discovering it tough to purchase the reasonably priced houses offered for them by these non-public schemes. The sector has modified, has needed to change, and has been committing quite a lot of assets in recent times to repairing and remediating its inventory, moderately than including to its inventory.
It could be that “planning achieve” circumstances must be relaxed in order that stalled tasks can go forward and at the very least some social hire and different reasonably priced houses are constructed moderately than, as at current, none. Annoying, sure. But in addition true.
Ten: Not Sufficient Yimby
Cries of Sure In My Again Yard have to be heard extra loudly, extra clearly and from as many Londoners as attainable, together with its politicians of all persuasions. A unprecedented place has been reached the place the Conservatives, who used to see theirs because the social gathering of dwelling possession, have turn into the social gathering of Nimbyism, the Liberal Democrats are the identical and the Greens, for various causes, are fairly ambivalent about new housing developments too.
London is, then, lucky that Labour is in energy nationally, has made enormously growing housebuilding a precedence and has London’s Labour Mayor shifting in the identical course. However solely a lot could be accomplished by modifications to the planning framework and setting huge, daring targets. All the problems above have to be addressed in a technique or one other.
Together with that, and vitally vital, public help for extra housing must be nurtured and fought for by politicians and others who recognise that until London makes a greater job of getting extra of its folks into higher houses, the implications are going to be an increasing number of critical – and that the rewards of succeeding could be big.
OnLondon.co.uk offers distinctive, no-advertising and no-paywall protection of the capital’s politics, improvement and tradition. Assist the web site and its writers for simply £5 a month or £50 a yr and get issues that different folks gained’t. Particulars HERE. Comply with Dave Hill on Bluesky. Photograph. New houses at Brent Cross.
