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The ARCH annual report for 2015-16 is now available to view.

 

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House of Commons: Meeting London's housing needs 17/09/2015

The House of Commons has produced a briefing paper which will be helpful for councils in and around London. It considers evidence of London's housing crisis; how much additional housing is needed; and the barriers and potential solutions to the issue arising from a selection of research projects.

 

The long-term failure to develop sufficient housing in London to keep up with its growing population, and to deal with the rising backlog of need, is demonstrated by rising house prices and rents as well as rising levels of homelessness and overcrowding. The proportion of households privately renting is growing while owner occupation (still the tenure of choice) is falling. It's widely recognised that the lack of affordable housing in London could put the Capital's economic competitiveness in jeopardy as an increasing number of London's workers say they are prepared to leave.

 

Estimates of the need for additional housebuilding in London fall within a range of 50,000-80,000 per year. Housing completions are well below this level; 2012-13 saw 21,900 net conventional completions. The Mayor's Housing Strategy (2014) contains an ambition to build 42,000 new homes per year for 20 years. Clearly this is well below assessed need, but the target has been defended on the grounds that a higher level would exceed assessed capacity, while the target for affordable housing (45,000 over three years) is said to be deliverable in the light of available public subsidy.

 

There has been a good deal of research over the years into why London has such a severe housing shortage with a view to identifying barriers and developing solutions. This research has highlighted problems with; for example, the planning system (complex, inconsistent and subject to too much change); land availability; complex land ownership and high land values; building at too low densities; and difficulties in accessing finance.

 

The Mayor and the Greater London Authority have developed initiatives aimed at promoting development such as Housing Zones and the London Land Commission. However commentators believe there is a need to do more and are concerned that some recently announced policies (reduction of the benefit cap, extending the Right to Buy and freezing Local Housing Allowance rates) could exacerbate London's affordability challenges.

 

It is accepted that there is no single 'silver bullet' solution for resolving London's housing shortage. There have been calls; for example, to review the policy of not building on London's Green Belt; increase density levels; remove blockages from the planning process and set and enforce 'hard' housebuilding targets for local authorities.

 

The debate continues; the Institute for Public Policy Research launched the London Housing Commission in June 2015 to decipher evidence and produce a clear programme of action for London's housing market, while the London School of Economics launched an ongoing project in September 2014 which is exploring key barriers to increasing London's housing supply.

 

Click to read the full report.

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