Some boroughs saw just one new affordable property begin construction in the space of a year, with Enfield starting three, reports Noah Vickers, Local Democracy Reporter
The number of affordable homes started in London has fallen 88%, new statistics have revealed, with some boroughs starting just one new affordable property each in the space of a year.
Only 3,156 affordable homes began construction across the whole of London between April 2023 and March of this year, down from 26,386 starts in the previous twelve months, according to government data.
Bexley, Harrow, Richmond-upon-Thames, and the ‘square mile’ of the City of London each saw only one new affordable property started. Work began on just two in Kensington and Chelsea, and only three each in Brent, Enfield and Lambeth. In Newham, four got started.
‘Affordable housing’ is a wide-ranging category which includes homes let at rents of no more than 80% of local market rates, as well as shared ownership homes and social rent properties which are set at around 50% of market levels, among other property types.
London’s 88% reduction in affordable homes started in the last financial year compares with a 39% fall across the whole of England, where starts fell from 71,771 in 2022/23 to 43,439 in 2023/24.
A government spokesman said the statistics “emphasise the scale of the housing crisis we have inherited” and that changes to the planning system, along with increased funding and making local housing targets mandatory, would improve the situation.
Chancellor Rachel Reeves announced in her recent Budget a £500m “top up” to the previous Conservative government’s £11.5bn England-wide Affordable Homes Programme. Of that extra £500m, London was allocated £100m, bringing the capital’s total share to £4.1bn.
Rob Anderson, research director at the Centre for London think tank, said: “While policy change such as planning reform to unlock areas on the ‘grey’ belt or incentivise housebuilding on brownfield land is a step in the right direction, it will not be enough to turn the corner on this crisis.
“The £500m uplift announced in the recent Budget was welcome, [but] the evidence suggests it will not be enough to deliver the number of social homes needed – estimates range from £4.6bn a year as a minimum, while a comprehensive programme could require up to £15.1bn annually.
“That’s why the upcoming spending review [in the spring of next year] is crucial. The government needs to commit to a real step-change in investment, collaborating with the mayor, local authorities, and housing providers to deliver on their housebuilding targets.
“These are significant sums. But housing is a foundational issue – it affects our health, our productivity and is key to sustainability. If the government really wants to fix the foundations, reduce waiting lists for the NHS, kickstart a new era of growth and achieve its net-zero targets, housing is the place to start.”
The London boroughs which saw the most affordable homes started in 2023/24 were Barking and Dagenham (584 starts, down from 1,021 the previous year), Greenwich (406, down from 2,615) and Redbridge (351, down from 575).
Andy Hulme, chief executive of housing association The Hyde Group, said: “At a time when record numbers of homeless children are living in temporary accommodation, this sharp fall in affordable housing starts should be concerning for everyone.
“Unfortunately, this will lead to more people becoming homeless in the coming months and years, as less affordable housing is being delivered at a time when the demand for affordable housing is increasing.
“However, the most acute housing problem is the steep long-term fall in the supply of social housing, which has fallen off a cliff over the past thirty years.
“To tackle the housing emergency, we need more grant funding to build more social homes and we need a more ambitious ten-year rent settlement that includes a fair approach to rent convergence.”
A spokesman at the Ministry of Housing, Communities and Local Government said: “These statistics emphasise the scale of the housing crisis we have inherited. We will fix this by delivering the biggest increase in social and affordable housing in a generation.
“We will also make changes to the planning system, restore mandatory housing targets for councils, and we have boosted the Affordable Homes Programme by £500m.
“Everywhere must play its part to bring the housing crisis to an end and we will work in close partnership with the mayor to radically boost housebuilding in the capital and build the homes that London needs.”
A spokesperson for mayor Sadiq Khan said: “The disastrous inheritance from the previous government has left national housebuilding on its knees, with developers previously predicting housebuilding could fall to the lowest level since the Second World War.
“While the impact of this legacy is being felt most acutely in London, it is apparent across the country, with the Office for Budget Responsibility projecting housing completions will fall this year and next.
“Despite this, thousands of affordable homes are still being built across London, with the mayor’s success on affordable housing meaning the capital is well placed to carry on building homes, even during this incredibly tough period.
“Under his tenure the mayor has started more new council homes than any time since the 1970s, and Sadiq will continue to work hand-in-hand with the new government to turn the tide on the last 14 years of underinvestment in housebuilding, helping to create a better, fairer London for everyone.”
A spokesperson for London Councils, the capital’s local government association, said: “Despite massive challenges, boroughs are working hard to accelerate housebuilding and have made solid progress in recent years. London saw more council-built homes started in 2022 than any year since the 1970s.
“However, market conditions for starting to build new housing are currently incredibly tough. There are 287,000 potential new homes in London with planning permission, including 70,000 affordable homes, that have yet to be built. There are a lot of barriers to unlocking these sites – such as skyrocketing construction costs, and in recent years, a lack of capital funding and infrastructure.
“On top of this, London’s higher land values mean that current grant levels are insufficient to secure the viability of schemes. Many boroughs can’t make up the shortfall – across London there’s a cumulative £700m funding gap in social housing budgets.
“We are committed to overcoming these barriers to our building ambitions, working closely with government and the Greater London Authority.”
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