Plan to tackle London’s housing crisis by building 900,000 new homes unveiled

  • Get London Building is a plan for how 893,000 energy-efficiency homes could be built in the capital
  • The next mayoral election is an opportunity to regenerate damp and draughty estates, build in the best connected places and use London’s industrial land and golf courses better
  • A 1% increase in economic growth in London would produce around £2.5bn more for public services like the NHS

London is in a housing crisis.

Today it takes a couple in the capital, earning a normal income, 30 years to save a deposit for the average property, up from just 4 years in the mid 1990s.

Across the city house prices have risen to 12.5 times the average income. In many boroughs, such as Hackney, Haringey, and Islington, prices are 15 times average income.

London is so expensive compared to the rest of England that the rent on a one bed property in London (£1,276 per month) is more expensive than a three bed property in any other region.

Young Londoners in good jobs are now forced to choose between lengthy commutes or crowded flatshares because housing supply has not kept up with demand.

But a new report published by pro-growth campaign group Britain Remade has shown how 893,000 new energy-efficient homes could be built in the capital.

The report, Get London Building, sets out how the next occupant of City Hall can build the homes Londoners need by regenerating estates, building in the best connected places and using land better by building homes on publicly-owned golf courses and industrial sites.

Too many Londoners live in post-war social housing that is cold, damp, and crowded. Estate renewal not only tackles these scourges, but also delivers the extra housing London desperately needs.

This can be achieved because the capital’s post-war estates were built at densities far lower than many of London’s best-loved historic neighbourhoods. Marylebone, for example, is built at more than five times the density of many post-war estates.

With new homes selling for four times their construction costs, this provides the funds needed to build warmer and larger homes for existing council tenants and a net increase in the social housing stock.

Rebuilding London’s estates at modest densities could deliver over 530,000 extra new homes on top of the 540,000 rebuilt and upgraded social homes.

Not only will regenerating London’s estates tackle the capital’s extreme housing shortage and cut council housing waiting lists, it will also save money and help the country go green. If all new estates are built to the highest energy efficiency standards, the average council tenant would save almost £800 a year in lower gas and electric bills.

Along with estate renewal Britain Remade also urges the winner of the mayoral election to build more homes in London’s best connected areas, a move that could add 38,000 homes each year, cut congestion, and reduce London’s emissions.

A similar move in Auckland doubled housebuilding, cut emissions and resulted in rents being a third lower than they otherwise would have been. If the same happened in London it would result in a £6,000 saving for a young family renting the average two-bed.

To enable this the Mayor should rewrite the London Plan to explicitly allow up to six-storey developments on small sites near the capital’s best connected areas.

A similar proposal in the 2019 Draft London Plan would have seen more than 25,000 homes a year built. Yet, the policy was dropped after Planning Inspectors intervened arguing the approach was “too far too soon”.

Using London’s land better can unlock 325,000 good homes within walking distance of public transport, bringing affordable housing to working people who are being priced out of the capital.

Around two-thirds of London’s industrial land is protected by the London Plan, meaning all housebuilding on it is effectively banned and a council’s ability to release land adjacent to industrial sites is restricted.

The Park Royal Industrial Area in Acton contains more than 338 hectares of land within walking distance of the area's 11 underground stations, the Acton Mainline Station on the Elizabeth line and the future HS2 station Old Oak Common. If just the part of the site within 10 minutes walk of a tube or train station was developed to Parisian densities (400 dwellings per hectare), it could deliver 135,000 new homes.

In addition to Park Royal, releasing all the remaining Strategic Industrial Land within 10 minutes walking distance of a station for development at terraced house density, would allow 157,000 new homes to be built for Londoners.

High rents and house prices don’t just mean Londoners cannot get on the housing ladder, it holds back our economy.

London is the UK’s most productive city and makes up just under a quarter of Britain’s GDP. A 1% increase in economic growth in London would produce around £2.5bn more money for public services like the NHS.

If London’s housing costs were brought down and more people could afford to live and work in the capital, it would make the UK’s economy stronger and end a decade plus of stagnation in living standards.

Sam Richards, founder and campaign director at Britain Remade, said:

“The London housing market is broken. Right now young people working good jobs face the prospect of never being able to own their own home”

“Housing in London doesn’t have to be unaffordable. It is a choice. For too long, politicians have chosen not to build enough homes to meet demand. The only way to fix this is to build more homes.

“From transforming the capital’s post-war estates to provide warmer and bigger homes for existing residents to better using land across the city our report, Get London Building, is a blueprint for wherever is the next occupant of City Hall to deliver the affordable homes Londoners desperately need.”

Emma Pinchbeck, CEO of Energy UK, said:

“With millions of customers still struggling to pay their energy bills after a long period of high prices, it’s more important than ever to stress that energy efficient properties are the best way to cut costs permanently - in addition to their role in reducing emissions and providing warmer, more comfortable homes.

“Those living in the draughtiest homes are unfortunately often those who can least afford to waste energy so tackling the poor energy efficiency of social housing, including London’s post-war estates, is particularly important.

“In addition to improving the daily lives of residents, with buildings remaining the UK’s second highest-emitting sector, a programme to improve energy efficiency in these properties would make a major contribution to cutting London’s carbon emissions and making further progress towards reaching the UK’s climate change targets.”