I'm instinctively suspicious of restaurants with large menus. How on earth can anything actually be fresh? And I feel the same way about writers who will happily offer an opinion on any subject. Surely they can't be an expert on everything? It is for this reason that I try to avoid pontificating on issues I know little about. Hence why every other newsletter is about fuel duty, Tony Blair or Roger Federer.
Housing is one of those blindspots. It's obviously a critical issue, impacting everything from our health and quality of life to economic productivity. Like the rest of you, I'm aware that planning constraints are a big part of the problem, but also sceptical that looser regulations alone will adequately address the problem.
Indeed only last week, housing minister Matthew Pennycook told the Housing, Communities and Local Government Committee that delivering 1.5 million homes "is going to be more difficult than we expected in opposition." No kidding. And things look particularly bleak in the capital.
As local democracy reporter Noah Vickers reveals, the number of affordable homes started in London has fallen by an astonishing 88 per cent, with some boroughs starting just one new affordable property each in the space of a year. According to the government's own data, 3,156 affordable homes began construction across the whole of Greater London between April 2023 and March of this year, down from 26,386 starts in the previous 12 months.
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. In last month's Budget, Rachel Reeves announced a £500m "top up" to the previous Conservative government’s £11.5bn England-wide Affordable Homes Programme, with £100m of that going to the capital.
But £500m is unlikely to make much of a dent. Rob Anderson, research director at the Centre for London think tank, explained: “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."
Why are things so difficult? Again, it's not just about planning, critical though that is. Construction, like any sector, is impacted by broader economic forces. And market conditions for building new homes have been pretty tough. A spokeswoman for London Councils, the capital’s local government association, points out:
"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."
You can also blame Liz Truss if you like. Persimmon’s new-home completions fell by more than a third in the first half of 2023 due to what it labelled as “market challenges after last autumn’s mini-Budget”. Other issues include uncertainty around second staircase regulations. Earlier this year, Sadiq Khan told the London Assembly that 38,000 homes had been delayed as builders struggled with new fire-safety regulations.
Ending on the politics. Labour promised 1.5 million new homes over the parliament. This was an ambitious target, particularly for something over which the government does not exercise much control. It it fails, the party is likely to pay a steep electoral price.
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