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9 March 2018updated 04 Aug 2021 9:05am

We can’t rely on the private sector to deliver the homes we need

The Mayor of London outlines his new blueprint for affordable homes in the UK’s capital city. 

By Sadiq Khan

The only way we will ever truly fix the housing crisis is through a step change in national action. We need a significant increase in investment from the government, far greater powers to free up land for homes, and changes to enable councils and mayors to build many more affordable homes. However, despite the limits on what we can do in London, we are already beginning to turn things around.

The housing crisis is the biggest barrier standing in the way of Londoners fulfilling their potential and sharing in our country’s prosperity. Yet the government is still completely failing to act in a way that matches the scale of the human consequences. 

As the Mayor of London, I hear countless personal stories and experiences from Londoners who are suffering from the many knock-on effects of the housing crisis. From vulnerable tenants who have found themselves at the mercy of rogue landlords, to those who have been plunged into poverty because of soaring rents, and from children growing up in chronically overcrowded houses to those who fear they will never be able to buy a property they can call home. 

We should never forget this human toll. It’s why a lack of decent affordable housing registers at the very top of Londoners’ concerns, and it’s why I’ve made tackling the housing crisis a priority from day one of my time in City Hall. 

Londoners know better than anyone that there has been a systematic failure for decades now – under successive governments – to build enough new homes that are genuinely affordable to ordinary Londoners. But the situation 
has got even worse since 2010. 

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The amount of money invested in building new affordable housing in London peaked in 2010 at £1.75bn – that was the last year Labour were in power in Westminster. Since then, the Tories have slashed London’s affordable housing budget to less than a third of that figure – just £500m a year. 

New City Hall research shows that to meet the housing targets in the new London Plan, we would need to increase that figure to somewhere in the region of £2.7bn a year – more than five times current spending levels.

This systemic and historic underinvestment was compounded by the terrible approach to housing taken by the previous Mayor of London. Under Boris Johnson, funding for new homes at social rent levels fell to zero and rough sleeping doubled. In his last year in office, just 13 per cent of homes given planning permission were affordable – and that’s using his discredited definition of what an “affordable” home is. I’m using all the powers at my disposal as mayor to clear up the mess I inherited and we have already taken some big steps forward. 

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We have increased the number of genuinely affordable homes in planning applications to 38 per cent in the first half of last year, and I’ve committed to a long-term target of 50 per cent of all new homes built being genuinely affordable.

We have secured major investment from government to build new homes based on social rent levels, as part of an overall package for 90,000 new and genuinely affordable homes. And we are introducing new measures to help those who feel they have no choice other than to sleep rough, to crack down on rogue landlords, and to support councils taking action when speculative investors leave properties empty.

I’m also simplifying the overly complex rules around planning. My new draft London Plan – the blueprint for the capital – includes new measures to boost the number of new and affordable homes built every year. It offers a fast-track route to planning permission if projects reach a minimum of 35 per cent affordable housing – or 50 per cent on public land. I’ve also ditched the old guidelines that limited density, made it easier for small developers to build more homes on small sites, and set ambitious targets for councils across the capital to roughly double their current rate of homebuilding. 

This is solid progress. But London can’t tackle this problem alone. We need central government to step up to the plate and go much further, much faster. They can’t ignore this crisis any longer. 

London’s population is forecast to grow rapidly – reaching nearly 11 million by 2041. To plan for this growth – and deal with the current chronic shortfall of affordable homes – London needs to build 66,000 new homes a year. This is almost double the number of homes currently being built and will require major new investment, alongside new powers and resources for London’s councils and City Hall.

There is no way we can rely on the private sector alone to deliver on this kind of scale. For too long we’ve seen developers building luxury flats for wealthy investors, rather than the homes Londoners desperately need. 

What we need is a real boost in funding from central government for affordable homes, and for councils and City Hall to be given the powers we need – including freeing councils from borrowing restrictions – so we can once again build council homes in greater numbers.

The housing crisis is hurting many lives and leading to greater inequality – setting people back for decades. Fixing this problem is key to creating a better, fairer, more inclusive London. I’m optimistic that we can do it, but it’s high time the government stepped up and played its part.