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Government Urged To Go "Much Further" To Solve London's Housing Crisis


4 min read

Housing campaigners are urging the Government to go “much further” to address London’s housing crisis, after Prime Minister Rishi Sunak announced a series of policies to build more homes in the capital.

The Government pledged an extra £200million to regenerate brownfield sites in West and East London. It claimed the new funds were an addition to £1billion worth of funds to deliver affordable housing across the city.

Sunak's announcement for London follows a major announcement by housing secretary Michael Gove earlier this week to build more houses across the country. 

A key pillar of Gove’s reforms include plans to redevelop social housing estates, which will be funded as part of the Government’s Affordable Homes Programme. The Government has claimed its new Docklands 2.0 scheme will create up to 65,000 homes and regenerate sites including at Thamesmead, Beckton and Silvertown

The Government also promised to consider options to “bolster transport links” in the area to attract more investment. 

Samuel Hughes, Head of Housing at Centre for Policy Studies, told PoliticsHome that he believed Sunak and Gove have been “right to focus” on building more homes in London, but felt central Government must go “much further” than its initial plans if it is serious about solving the housing crisis.

“Britain's housing shortage is concentrated in London, and the Government is right to focus its efforts there," he explained. 

“Today's measures are welcome first steps, but the Government needs to go much further in enabling redevelopment of underused industrial sites and tenant-led regeneration of social housing estates if it is to build homes on the scale that the capital needs.”

On Monday, Gove said London needed 52,000 new homes a year to meet current demand. According to the London Plan, which sets out an overall strategy for the capital, as few as 30,000 properties have been built in London every year. 

The median price of a London home has continued to outstrip the average property price across the country. London's average house prices remain the most expensive of any region in the UK, with an average price of £534,000 in April 2023, according to the ONS.

Tom Spencer, Research Manager at PricedOut, told PoliticsHome he welcomed that the Government was “paying attention” to the housing crisis in London. But he urged both the Conservative and Labour parties to “stop clashing heads” over housing policy and “deliver the homes Londoners need”.

In the recent announcements, Sunak and Gove have blamed many of London’s historic housing problems on the London mayor Sadiq Khan, despite stalled planning reforms from government having prevented a significant increase in building in and around the capital. 

"Whilst we welcome the Government paying attention to London’s poor record on housebuilding, it is worth remembering that the very same individuals have overseen an equally poor record on housebuilding, exacerbated by abandoning housing targets," Spencer continued. 

“Under Sadiq Khan, London has averaged 10,000 more new homes a year than his predecessor and has seen a record number of affordable homes - however, housing approvals have fallen, and completions have never reached the levels targeted in the London Plan.

“This means that housing costs have only increased at a faster rate under his tenure. If we ever want to get to grips with this housing crisis, we need both parties to stop clashing heads and come together to actually deliver the homes Londoners need."

Ant Breach, Senior Analyst at Centre for Cities, told PoliticsHome he believed any proposals to build more homes require major reform to the planning system.

“London has lots of low-rise, terraced, semi-detached urban neighbourhoods even next door to Tube stations in Zone 2. We could have more mid-rise apartment buildings, but the planning system currently bans these types of homes across most of London," Breach said. 

Britain has no specific rules on what developers have to do to gain planning permission in the UK. For a project to gain consent it must be given the green light by a local authority, which is done on a case-by-case basis. 

“It would be good to hear from those promising more housing some proposals to remove the planning system's underlying barriers to development that are driving London's housing crisis," Breach added.

Emily Fielder, Director of Communications at the Adam Smith Institute, told PoliticsHome she welcomed the Government’s decision to remove barriers to building houses in the capital.

However, she believed the Government should remove the same obstacles to housebuilding in other UK cities too.

“It's great to see that the Government has acknowledged the simple fact that a lack of housing supply has pushed up the prices of homes," Fielder explained. 

“It is right that action is taken to remove barriers to building the houses we need are removed, and that the Mayor of London is held to account on this issue.

“But the Conservatives need to keep in mind that it is not only Londoners who have been hit by the housing crisis. It is vital that this approach is now replicated in our other cities if the Government wants to make good on its promise to level up the country.”

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