Could London lead the way in tackling the housing crisis?

The lack of affordable housing has been widely acknowledged as one of the UK’s biggest social, economical and political issues of our time. We speak to Sam Collins, Property Developer, about the crisis and the options for delivering more homes. 

Sam Collins

Throughout the country it has become increasingly difficult for young people to rent, let alone buy a home. The knock on effect of this has left a growing number of parents with adult children unable to fly the nest, leaving families squeezed into unsuitably small spaces, unable to climb the property ladder. Nowhere is more badly effected than London. At the beginning of September came the news that someone – London Mayor, Sadiq Khan, to be specific – is finally taking serious steps to help resolve the problem. But what does his housing strategy really mean, and could it be the first step towards resolving the housing crisis?

The first draft proposals issued by the Mayor’s office discuss a five-tier strategy, beginning with the construction of 90,000 affordable homes, and ending with a plan to put an end to rough sleeping. It is, in the Mayor’s words, ‘a marathon rather than a sprint’, so while the news is incredibly welcome, and has led to much rejoicing by housing associations, contractors, and home-hunters, it does raise one worrying concern: what will happen if Mr Khan leaves office?

Unlike his Mayoral predecessors, Sadiq Khan appears to have applied due care and attention in determining the viability of his housing plans. £250M pounds has been earmarked by City Hall to be used during the first stage of the stratagem. Land with the potential for development has been identified, including the recently sold derelict Webbs Industrial Estate in Waltham Forest. This will shortly become a new neighbourhood, with 330 new genuinely affordable homes to be built by Catalyst and Swan housing associations. In addition, the Mayor is looking at a potential legislation to ensure a better deal for private renters – something which may initially cause concern amongst landlords, but has the ability to create a more stable market with longer-term, guaranteed income without an endless search for reliable tenants.

What has taken place in Tower Hamlets alone in the last 12 months, with the large-scale regeneration of the area, is enough to add credence to the Mayor’s new plans. However, the mayoral term is just four years. In order to bring real confidence for investors and contractors, central Government need to get behind the scheme. This could come into effect with a cross-party agreement to ensure that during this time of flux, when no political party has the stability which long-term planning must build its foundations upon, this housing strategy will not find itself being buffeted by the changing winds of successive governments.

With the relevant support and guarantees in place, the “London Model’, as it’s being nominated, has the potential to be a real game-changer in the capital and beyond. Sites such as the defunct Waltham Forest Webb Industrial Estate could be rejuvenated into thriving areas of mixed housing, helping to pump the blood of talent through the city’s veins – because without housing the city just cannot be sustained.

The changes to the private rental market are equally important. Both landlords and tenants will be keen to see what the adjustments to the 30-year-old rules and regulations could be. But if longer-term agreements are on the horizon, with fixed rents that surpass the 6-12 month traditional period, it could help to provide security to both tenant and landlord in the medium term, and perhaps lead to increased purchasing power in the longer term. With lower rents over a sustained period of time this would allow the tenant to potentially save for a deposit to put towards owning their own home.

When you add in City Hall’s plans to provide greater support to new housing providers, including community builders, the picture appears complete and surprisingly rosy. If more people are trained within the construction industry, output can increase, which in turn will have an impact on employment; with more people in work more people will be able to afford to rent or purchase their own homes. With ‘Brexit’ on the horizon, Britain may well find itself in need of home-grown builders, plasterers, carpenters and labourers.

If, as is posited, the output of new homes in London is doubled to 50,000 per year, providing more individuals and families with long-term homes – rather than just places to live – we could see a potential end to one of London’s biggest problems. If we can then roll the London Model out nationwide, the issue of affordable housing could be permanently resolved.

There’s a long road in between any plans being put on to paper and seeing the fruit made of bricks and mortar, but in my view the Mayor’s housing strategy has the potential to go far. What remains to be seen is whether it’s given the support it needs to become a reality in the long term.

 

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