New 66,000 homes target for London is welcome but does not go far enough

19 October 2017

Today’s announcement by Jules Pipe, London’s deputy mayor for planning, regeneration and skills, that the new London Plan will look to provide 66,000 new homes a year during its lifetime, a significant 17,000 more than the current 49,000 target, set out in 2015 represents real progress and is to be welcomed.

However, this is significantly below requirement in the capital.  We estimate that London now needs to build 90,000-100,000 new homes a year to meet need and begin to address affordability issues.  Years of undersupply in the capital means that this new target, while ambitious in the context of delivery over recent years, will not begin to make a dent on affordability.  Co-operation with surrounding local authorities is essential to relieve pressure in the capital.

Emily Williams, Savills residential research analyst, says: “There continues to be a massive shortfall both in London and its surrounds and it is this misalignment of housing need versus delivery which could ultimately hinder economic growth. 

“But London’s housing need cannot be considered in isolation. There needs to be an enforceable mechanism to ensure that London’s overspill housing need to be accommodated elsewhere.”

Substantially more land needs to be released for housing development in the higher-demand markets of London and surrounding local authorities if new homes volumes are going to increase to meet increased targets.   In Planning to solve the housing crisis, Savills considers three main options for increasing supply in order to accommodate local housing need in these locations, together with London’s overspill.  These are:

  • A comprehensive review of density policies, particularly in London, including big increases in the number of homes planned near transport hubs.
  • Local authorities could release land through the Green Belt review process, including Green Belt ‘swaps’. 
  • Local authorities could work in partnership – through the duty to cooperate – to allocate land to accommodate their housing need in less constrained markets.  This approach would require a great level of strategic planning, and investment in infrastructure to ensure new housing is connected to areas of unmet need.

In reality, a combination of all of these approaches would have the biggest impact. 


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Sue Laming

Sue Laming

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