Move to cut London’s housebuilding target raises eyebrows
Angela Rayner’s decision to cut London’s housing target has raised some eyebrows given the severe housing crisis facing Londoners.
In a speech in the House of Commons this afternoon, the deputy Prime Minister confirmed that mandatory housing targets would be reinstated for local authorities among a swathe of other planning changes.
But the new target for London, of 80,000 new homes a year, was lower than the 100,000 pursued by Conservatives before the party watered down the targets in 2022.
The government noted that the new target was “nearly three times the existing level of delivery”. Just over 35,000 homes were completed in 2022-23 according to the latest figures.
“While we must significantly ramp up numbers in the capital, setting a target that is removed from reality just shifts numbers away from areas where they can be delivered,” the government said.
The change reflects the government’s new method for determining what local authorities’ housebuilding target will be.
Previous targets were concentrated in urban areas due to the ‘urban uplift’, introduced by the Conservatives in 2021. Under Labour’s new proposals, all local authorities will be required to increase housing supply by 0.8 per cent, with some tweaks made according to affordability issues.
However, a number of commentators argued that Rayner needed to set more ambitious targets for the capital given the well-publicised affordability issues in London.
The latest figures showed that in 82 per cent of London local authorities, house prices were more than 12 times average earnings. This means the most affordable parts of London are still more expensive than the most expensive parts of the northeast.
Sam Richards, chief executive of Britain Remade, said the decision to cut London’s annual target was “a mistake”.
“London has Britain’s most acute housing shortage and cities across the world show that 100,000 homes per year can be done. In recent years, Austin, Auckland, and Tokyo have all surpassed it, relative to their populations,” he said.
The campaign group has been campaigning for the government to make it much easier to build near existing public transport sites, which it claims could unlock 134,000 homes within walking distance of London’s tube and train stations.
Freddie Poster, executive director at Priced Out said it was a “shame” to see London’s housing target cut by 20 per cent. “This is exactly where we should be building homes,” he said.
But other commentators noted that a target of 80,000 was still very ambitious compared to delivery.
Jason Lowes, planning partner at strategic property consultancy Rapleys, said the new target was still more than double the current delivery.
“This may well be the Government recognising the challenges of developing in London, and changing the dial from ambition to a more realistic position,” he said.
Similarly, Anthony Breach, associate director at the Centre for Cities, said that an 80,000 target would still require “big changes” to the London Plan.
Breach pointed out that the “majority” of new homes in England needed to be built in London or the southeast, noting that reforms to the green belt around London could take up some of the 20,000 difference.
Rayner herself was clear that Labour was not lowering ambitions for London. “I’m clear we’re doing no such thing,” she said, arguing London’s previous target was based on an “arbitrary uplift” which was “absolute nonsense”.